Fixed rate mortgage nightmares.

LizEstelle

http://www.housepricecrash.co.uk/for...owtopic=125100

tiff

link not working

LizEstelle

Try this one, then:

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/6088342/Comment-mortgage-swap-rates-fall-but-fixed-rates-dont.html

It's easy for the apologists to whinge 'myth, myth'... but hard facts like these confront anyone who is currently up for remortgaging.

Then the whingeing tends to fade...

taktikback

Why not take advantage of the historically low SVRs ?. Nobody is forcing you to fix.
It's a bit like going into the bookies and demanding 20-1 on Manchester United finishing in the top 4. The market doesn't support those odds..

Good2go_2

thats the trouble with fixed rates !!

you pay the price for security each month....like others have said, im sure no one would be contacting their bank if the rates went sky high and they were paying far under the current rates !!!!

bottom line is , that they are a gamble, sometimes it works out, sometimes it doesnt....

sammyjammy

LizEstelle wrote: »

Try this one, then:

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/6088342/Comment-mortgage-swap-rates-fall-but-fixed-rates-dont.html

It's easy for the apologists to whinge 'myth, myth'... but hard facts like these confront anyone who is currently up for remortgaging.

Then the whingeing tends to fade...

How very dare you!

My mortgage runs out in 8 weeks time and I stand by my post, I took a massive risk when I took out my tracker two years ago. It paid off, well lucky me but withotu the unprecendenting banking problems it might not have, its happened to me before nad thems the breaks.

I'll be sitting on the SVR for a few months whilst I decide what to do, when I take a fix I'll look for the best rate I can get and then start ignoring interests and get on with the job of paying it off as quickly as I can.

No whingeing!

opinions4u

LizEstelle wrote: »

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/6088342/Comment-mortgage-swap-rates-fall-but-fixed-rates-dont.html

It's easy for the apologists to whinge 'myth, myth'... but hard facts like these confront anyone who is currently up for remortgaging.

Then the whingeing tends to fade...

The link makes good reading.

The opening paragraph states:

In its regular comparison of the price of fixed-rate mortgages with swap rates, moneyfacts has flagged up that the current differential of 3.14pc between two-year swaps at 2.04pc and the average two-year fix at 5.18pc is the widest on record.

Again, the point about margins needs to be made. Despite the gap quoted here, bank margins on mortgage lending have narrowed because of increased bad debt losses.

gratefulforhelp_2

surely every time you make a decision on taking an interest rate on a financial product, you are simply gambling on the interest rates and how they will change over time/how your chosen financial institution will respond to those changes?

Some win, some lose, inevitably, as with any gambling, the institutions accepting your bets come out on top.

Making an unfortunate choice is just bad luck, but the more research you do, the less likely you are to make a bad choice.

Gorgeous_George

Are you sure its £350 per month that you would have saved? Is your mortgage in the region of £400K on repayment terms? Or £280K on interest only?

I do not recall Alistair Darling telling people to fix their mortgage rates. I doubt that he is qualified to give such advice. People need to be responsible for their own decisions. If you took a mortgage that you later regret, that is your fault. Besides 5.89% ain't that bad.

I'd really like to be convinced that the £350 is anywhere near accurate. How did you work it out? I can only guess that you are comparing mortgages with different terms as well as different rates.

GG

dunstonh

Again, the point about margins needs to be made. Despite the gap quoted here, bank margins on mortgage lending have narrowed because of increased bad debt losses.

That doesnt fit with how the media likes to report things does it. They would prefer to ignore the increase in bad debts and the greater provision banks need to make for failure and make a headline story out of it.

There are now more prime mortgages failing than sub prime. The risk premium involved in setting rates is obviously going to increase in that case.

During the good years the risk premium was very low. During the bad years it increases. You could argue that the banks should have kept it higher in the good times and banked the money to help pay for the bad but that didnt work and no doubt had they done that the same newspapers would crucify them for not passing on lower rates in the good times.

It is also worth noting that savings and fixed term deposit rates have been going up as well. Lenders are being encouraged to use more savers to pay for mortgages. Fixed term deposits are key in that area.