Base rate could be at 0.5% untill the end of 2011

Jonbvn

THRIFTY_GIRL wrote: »

Good news for tracker customers...I am relying on this to overpay as much as I can on my mortgage!!!

For most trackers it makes more sense to save than overpay. Of course it depends on the relative interest rates on your savings and mortgage, plus the fact that interest on savings is generally taxable (except for ISA's).

We are about 1.5-2% better off saving our disposable income rather than overpaying.

PasturesNew

If it were to be 0.5% until then, it'd "cost" me £20k that I expected to have earnt during that time in interest. Never expected interest rates to drop when I STR'd 2 years ago. Interest was my "safety net" money to live on. My "doesn't matter if you don't have a job, you have the interest" safety net.

ManAtHome

So get some stuck in instant access 3%+, 1 year fixed 3.75%+, 2 year fixed 4.3%+, 3 year fixed 5%+...

fc123

It's the only good thing that came out of the crunch for us too.
Lifetime 0.49% above base.
But we lost in many other (expensive) ways over the past decade, ever rising commercial property costs + business rates, price deflation in our sector so we were selling at ever lower prices.

I a few days time, I should have some good news..then off to the MFW board.

End 2011 we could clear it by then if rates stay low maybe? Then start saving as rates rise.

I tend not to count chickens (as they usually get diseases) but would be nice to be on the 'winning side' for once in our lives.

michaels

Didn't you get some into Newcastle BS at 5%?

PasturesNew wrote: »

If it were to be 0.5% until then, it'd "cost" me £20k that I expected to have earnt during that time in interest. Never expected interest rates to drop when I STR'd 2 years ago. Interest was my "safety net" money to live on. My "doesn't matter if you don't have a job, you have the interest" safety net.

ManAtHome

I passed on the Newcie - who knows what the T&Cs would be if the FSCS turns up - have stuck a few quid in 3 year 5% though.

econo_2

Thing is, for a lot of people who want a long term fixed rate mortgage for stability and to plan financially as much as is possible, the rates are hardly great anyway. For all the media hype about them being 'as low as ever' it maybe so for some and trackers, but for the most popular fixes it's not.

Makes you wonder if there was an upswing in rates how much they would actually climb in regard mortgage products anyway? If it was a steady rise (discounting a huge surge in inflation which is still the probable outcome) I don't see how fixed rate mortgages could climb much. How could you have a BOE rate at say 2.5% and banks trying to peddle 8% fixes? This maybe one reason why predictions of more huge falls in property prices because of the 'when rates start to rise' scenario might not be as much a foregone conclusion as many seem to think.

I'm still in the huge inflation down the road camp but one can always hope!

PasturesNew

michaels wrote: »

Didn't you get some into Newcastle BS at 5%?

I struggle to cope w ith savings accounts to be honest. I find them too confusing and complex to open. I have several accounts now (probably about 10) and I have trouble ever even logging onto them (all different, too confusing).

So I gave up trying to move money about.

But no, I didn't get any into the Newcastle. I think mine are all at about 2% or less.

I have tried on many occasions to get accounts and just seem to always fail to complete the sign up process somehow. Or sort of open them, but I'm not sure and I think they might be expecting money to be put in, but not sure ... and then I'm not in the zone any more and the letter's lost ... and I really don't manage my own matters well, it's one of my weak areas.

PasturesNew

ManAtHome wrote: »

3 year 5% though.

I can't lock money up because I don't know ever how long before I'll need it. My money has to be virtually instant access.

3 years, blimey ... in 3 years' time I expect to have found a job, moved across the country a bit, bought a house, settled in and had a Xmas or two under my belt... maybe.

Thrugelmir

econo wrote: »

Thing is, for a lot of people who want a long term fixed rate mortgage for stability and to plan financially as much as is possible, the rates are hardly great anyway. For all the media hype about them being 'as low as ever' it maybe so for some and trackers, but for the most popular fixes it's not.

Makes you wonder if there was an upswing in rates how much they would actually climb in regard mortgage products anyway? If it was a steady rise (discounting a huge surge in inflation which is still the probable outcome) I don't see how fixed rate mortgages could climb much. How could you have a BOE rate at say 2.5% and banks trying to peddle 8% fixes? This maybe one reason why predictions of more huge falls in property prices because of the 'when rates start to rise' scenario might not be as much a foregone conclusion as many seem to think.

I'm still in the huge inflation down the road camp but one can always hope!

Fixed mortgage rates are based on the underlying cost of the deposit rather than any connection to BOE base. The cost to Lloyds for retail deposits is 3.5% currently. Somewhat higher than BOE base at .5%.