The upcoming UK tracker time-bomb

ess0two

Really2 wrote: »

the un typical bit is the loan size.

A lot of trackers are lifetime also you can leave them at any time at no cost. (i went for a tracker because it was the only life time mortgage you could get)

Untypical or not if you could afford a £1200 pm mortgage,then when the tracker ends whats different?your just back paying £1200 again.

the_ash_and_the_oak

don't really understand why anyone would get a fix if rates are coming down imo

Heyman_2

HAMISH_MCTAVISH wrote: »

The article is pure hyperbole.

Yep - it's also recycled, I remember reading something very similar about 6 months ago. Oh the media with their ticking timebombs and this stereotyping of people who have no idea what is going on with their single biggest monthly outgoing :rolleyes:

Must be a slow news day

nollag2006

the_ash_and_the_oak wrote: »

BR+3.49=3.99% but i take your point, under 4% isn't actually all that bad - and its lifetime so no fees for coming off? you could take one of these and then just get onto one of the cheaper fixes in a year or two?

Indeed, and the set-up fees don't look too bad either. Especially if you open an account with them.

With a bit of luck over the first few years of ownership too your LTV ratio could also improve, resulting in you getting access to a much wider range of alternatives.

Moral of the story is that there is no ticking bomb around trackers. If anything the situation is getting much better, rather than worse

ManAtHome

Nationwide lost £450 million on their trackers last year - maybe the providers are ticking...

kennyboy66_2

As it happens, I come off a 5 year fix in Q3 2010 and currently pay 4.89%. When that
ends I will be SVR which for me is base rate plus 2%, so 2.5%.

I never see any articles titled the upcoming fixed rate bonanza

Obviously its a big 'if' that base rates will still be 0.5%. However if this is really such a big ticking time bomb, then they probably will be.

Really2

Timebomb = I have an indefinite period to prove myself right. Wait until next year I tell thee (or any time after now).

There is an old age timebomb and most people will die of it, you heard it here.

neas

why do people think they can just 'jump to fixed rates' when their tracker starts to rise?

Surely as tracker rates rise (because interest rates rise) so will the fixed rate you can get for 5 years.. otherwise it be silly wouldn't it?


You are on a +2.5% tracker now. so paying 3% interest (very good atm)
Interest rates start to rise up 1% so you are then paying 4% interest... you umm and arghh about changing but fixed rates also jumped 1%.. so you don't.

Then interest rates rise another 1%... and again fixed rise 1% and trackers 1%. The point is you will fix at higher or the same as what your tracker would be at that time.. The thing with fixed rate is fixing for say 5 years when its historically lower. so if you fixed at 4% for 5 years i'd see that as better than a +2.5% tracker.

the_ash_and_the_oak

have to admit with rates due to go up and also come down its a bit confusing imo

Really2

neas wrote: »

why do people think they can just 'jump to fixed rates' when their tracker starts to rise?

Surely as tracker rates rise (because interest rates rise) so will the fixed rate you can get for 5 years.. otherwise it be silly wouldn't it?

You do it when there are signs there will be a growing upward pressure (when rates are going up and likely to go over what you can fix at within a year or so). Like when there were signs of a growing downward pressure when I jumped to our tracker.

You make the move before rates move not after.

I am now using an offset tracker, can't ever see the point of moving it now. I pay it off like it is still at 6% that should iron out any peaks and troughs.