Rates to hit 2% next year.

the_ash_and_the_oak

I mean - I dunno I kinda think that inflation/deflation debate goes back at least 5 years imo

nearlynew

Isn't it funny how people (including myself) talk about the days of cheap and easy credit during the boom times when interest rates were 3-4%

You could get credit then just because you had one head.

Now, with interst rates even lower it's harder for people to get credit.


So really, it's nothing to do with interest rates.

Graham_Devon

StevieJ wrote: »

I think I was among the first on here (mainly bulls and Dopester) to anticipate record low interest rates (2%), didn't expect 0.5 though

You were not the only one Stevie...

http://forums.moneysavingexpert.com/showpost.html?p=15617371&postcount=15

mark55man

StevieJ wrote: »

Well played, I think many will wish they had followed your example in time :beer:

Thanks

Was a bit lucky when my previous fix ended, and also had a good advisor. Also was a bit lucky - because I needed to borrow an unknown (at the time) bit extra for an extension, I went with the coventry who had a 6 month offer period so really locked in April, but didn't start to October

Leeds did have a 4.75% for about a month before they took it off

steve237

I've been on base rate -0.16% for the last two years.

I hope I get lucky on my next (7 year) prediction.

LizzieS_2

steve237 wrote: »

For long term fixes, I don't think the has ever been a better time to fix.

As mentioned previously, I just locked into a 7 year fix at 5.39% with a £125 fee. (I have quite a high LTV so that's the best I could get)

I struggle to understand why anyone would fix for 2 or 3 years at slightly less than 5%, but for 5+ years - I really don't think you can go wrong.

Individuals will win on the fixed deals, but over a lot of individuals the banks will win more.

Fixed deals are good if you want certainty over payments for a few years, but will never guarantee you got a better deal overall.

IveSeenTheLight

mewbie wrote: »

You really are a bit of a pompous twit at times.

Yes, I guess I can be and admit it.
I also make sure I post factually correct info and back it up, can you say the same or does your personal thinking override all facts (being deliberately pompous )

IveSeenTheLight

the_ash_and_the_oak wrote: »

while this is correct and I'm sure everybody herewas quite comfortable paying what they did before rates dropped don't agree you can extrapolate that to the wider market. Think the rate cuts did have a positive effect in reducing forced sales, thats been taken out of the equation. A return towards previous levels would begin to bring that back into the equation again imo

that said - think the effect any future rises will affect future borrowers capacity rather than current owners particularly (though think there is a pool of vulnerable and exposed recent (over)borrowers that would come under pressure from a rise to anything approaching previous levels)

I agree the lower interest rate may have helped some mortgage borrowers who were on a tracker rate.

The theory that when interest rates go back up, that the !!!!!! will hit the fan is not a foregone conclusion.
It is possible that in the time they have benefitted, they have been able to get themselves out of the arrears they may have been and returned to good terms with the lender.

Remember also that there are options for people having problems paying their mortgage i.e. adjusting the amortization period.

IveSeenTheLight

mark88man wrote: »

not sure if this is helpful to the debate but i fixed for 10 years at 4.99, and whilst I wince from time to time at the better short term rates, I believe I will be OK in the long run. certainly glad not to have to worry with my mortgage (see footer)

10 years at 4.99% is bloody good.
The nearest I can see at the moment is 5 years at 4.99%
http://www.hsbc.co.uk/1/2/personal/mortgages/remortgage/fixed-rate;jsessionid=0000Wxm0g1U4wtVLZG5FiV1JKT5:12ntf1tru

the_ash_and_the_oak

IveSeenTheLight wrote: »

I agree the lower interest rate may have helped some mortgage borrowers who were on a tracker rate.

The theory that when interest rates go back up, that the !!!!!! will hit the fan is not a foregone conclusion.
It is possible that in the time they have benefitted, they have been able to get themselves out of the arrears they may have been and returned to good terms with the lender.

Remember also that there are options for people having problems paying their mortgage i.e. adjusting the amortization period.

its an interesting one - do think future rate rises will have more of an effect on future borrowers than existing ones generally and dont subscribe to the theory that rate rises on current owners will be the cause of future !!!!-fan-hitting but also find it difficult to ignore that prices stopped falling at pretty much exactly the time of the big rate cut. given that transactions didnt rise at this point pretty sure the effect this had was on current owners rather than new borrowers and that a reversal of this would have an effect on the very same people

as to why people were in trouble in the first place, imo it was not that they were paying too much interest but that they borrowed too much money. while i agree debt is being paid down if the initial cause was onerous interest rates (now slashed) then think a larger amount of capital would have been paid down. but as the initial cause was too much borrowed (causing a relatively low amount of interest to have an onerous effect) not yet sure that there's really been that much time to have paid off much of it and be edging on to safer ground yet