When the base rate starts to rise...

marcyj_2

I bought my first home last August. I was fortunate enough to get a decent mortgage just before things went really pear shaped. This is with HSBC; .99% above base rate, lifetime tracker, no start-up fees, free basic home survey.

Sure I am benefiting greatly now and that's fantastic but my concern is when the base rates go up. I presume it will go up in the same gradual fashion as it went down? That's obviously the time to get the fixed term mortgage. How do you think mortgage providers will react when this happens? Will there be any sub 4.00% fixed deals at the time or will they anticipate this and raise them all in unison? What about longer term; 10 or 25 years? At present I am overpaying in a big way and my LTV is now under 75% in order to try and get a better deal when fixed rates are eventually taken up by the majority.

Robert_Sterling_3

What the rates will be like at any time in the future is anybody's guess. There is no answer. We don't even know who will win the Oxford and Cambridge boatrace this year.

Trying_to_be_good

D'uh. It'll be Oxford.

samba

Robert_Sterling wrote: »

We don't even know who will win the Oxford and Cambridge boatrace this year.

And how do you know there will even be one this year?

cbrpaul

Im afraid no-one has the answers to your questions ,


Welcome to the world of uncertainty !!!

[Deleted User]

Have a graph of 25 years of interest rate history:
http://www.propertyinvestmentproject.co.uk/interestrates.php

Look at the rate hike between may 88 and november 88 - It rose by 5.5% in a matter 6 months. Another 10 months and they hit an all time high of 15%.

It can all go pear shape very quickly - it's unlikely though with the BoE controlling it

ILW

ringo_24601 wrote: »

Have a graph of 25 years of interest rate history:
http://www.propertyinvestmentproject.co.uk/interestrates.php

Look at the rate hike between may 88 and november 88 - It rose by 5.5% in a matter 6 months. Another 10 months and they hit an all time high of 15%.

It can all go pear shape very quickly - it's unlikely though with the BoE controlling it

Thats just when I took out my forst mortgage, was a real struggle and the values dropped 25%. Most people coming into the market now cannot believe it could ever happen.

Time2Go_25

ILW wrote: »

Thats just when I took out my forst mortgage, was a real struggle and the values dropped 25%. Most people coming into the market now cannot believe it could ever happen.

Me too, between me putting in the offer on the house and moving in my mortgage payments rose from manageable to more than my take home. Had to go to the bank of mum and dad for a while.

I got an old fridge from my sister and a cooker from my brother and some other bits and pieces second hand. No TV, No computer, just the basics.

Now people think they are in abject poverty if they don't have three tele's, two cars, satellite with full sky sports, games console, dishwashers etc.

MrC-117

marcyj wrote: »

At present I am overpaying in a big way and my LTV is now under 75%

That's about all you can do really. I've gone between fixed and variable mortgages over the years, but fortunately the most I've ever paid is 5.25% (only going back about seven years).

The way I try to look at is what can I do to keep my house if something bad happens (high interest rates, job loss, etc). Overpaying is a big step towards that. Also if you can get into the habbit of not spending too much when things happen like getting pay rises, bonuses, etc. things feel a lot more comfortable. As you're overpaying I think you've definitely got the right attitude towards managing mortgage repayments.

Peelerfart

"I got an old fridge from my sister and a cooker from my brother and some other bits and pieces second hand. No TV, No computer, just the basics."

LUXURY !!

I had no sister , and had to keep things cold by blowing on 'em !!!:rotfl:

Time2Go_25

Peelerfart wrote: »

"I got an old fridge from my sister and a cooker from my brother and some other bits and pieces second hand. No TV, No computer, just the basics."

LUXURY

Yes I know, "When I were a lad......":beer: