Mortgage costs soar despite rate freeze

chucky

HammerSmashedFace wrote: »

As you know chucky I'm not in any kind of desperate position, I'm quoting a story, and giving my opinion, which I believe is as good as yours or anyone elses, seeing as in general all of us are commenting on future events.

so no answer to the numbers - just a rubbish article with the no foundations to it then.

don't be so touchy - you're not desperate it's the posting of the article that's desperate.
12 months ago you would have posted something with more structure and foundation.

Really2

See it is a mail article. (holds link at arms length )
http://www.dailymail.co.uk/news/article-1241390/Homeowners-stung-mortgage-lenders-hike-charges-1-400-year--despite-Bank-England-holding-rate-record-low.html

Most seem to Building societies (well all in the article some I have not seen before). I presume they have had to put up rates to keep track with the saving rates they are increasing to get more business.

phil_b_2

Interest rates will have to go up massively for mortgages to soar and become 'expensive' IMO. I cant see any government being wreckless enough to do that, despite what they have gotten up to in the past.

HammerSmashedFace

chucky wrote: »

so no answer to the numbers - just a rubbish article with the no foundations to it then.

don't be so touchy - you're not desperate it's the posting of the article that's desperate.
12 months ago you would have posted something with more structure and foundation.

TBH mate, 12 months ago there would have been more articles about with more substance. I mean we can all remember the BBC's big 'downward arrow' posting the news and events of the time in autumn 2008, most of which was pretty informative, however once they realised the seriousness of our situation and it wasn't just a 'news game' to them it stopped.

Now with our current situation we are arguably in a worse postion as we borrow like no tomorrow to tread water, yet decent articles have dried up in the hope that not talking of it will somehow make it better.

stueyhants

One article in itself isn't that significant. One bank raising its rates ins't significant, but it's the trend that is important. Over the last few months a pattern is starting to emerge, although small rises at present is it a longer term trend, who knows?

We were all told rates would start to fall as margins decreased due to competition, this is starting to not look the case and when BoE rates do start to go up don't expect margins to buffer the impact on households.

Gorgeous_George

I agree with the OP.

My interest rate has soared from 6.24% to 1.24% since July 2007.

GG

Mr_Mumble

The source which has details all the SVR increases:
http://www.moneyfactsgroup.co.uk/press/pressreleases/displaypressrelease.asp?id=725

Carry-on arguing.

Rinoa

Here are the Building Societies in question:

Mansfield, Ipswich Building Society, Skipton, Accord Mortgages, Scottish Building Society, Cambridge Building Society and Marsden Building Society. All of whom account for probably less than 1% of current borrowers.

And Nationwide who have an SVR of 3.99% for new borrowers joining after April 2009, none of whom will have fallen onto the SVR rate yet. 99% of Nationwide borrowers on SVR will currently be paying 2.5%.

:rotfl:

Gorgeous_George

The bottom line, as has been mentioned many times before, is that lenders do not borrow long term funds at 0.5% and savers want a decent return for their money.

Those borrowers on long term trackers and SVRs that are linked to BofE base rate are enjoying extraordinarily low rates. Lenders need to compensate for this by charging other borrowers a premium over and above that which would ordinarily be required.

GG

HammerSmashedFace

phil_b wrote: »

Interest rates will have to go up massively for mortgages to soar and become 'expensive' IMO. I cant see any government being wreckless enough to do that, despite what they have gotten up to in the past.

We are in a Catch 22 at the moment, higher IR's would almost certainly crash the housing market along with most of the banks who lent foolishly in the last few years. We no longer have the capacity to bail them out again so the BoE/governemnt are hoping against hope that inflation won't rise, so they can keep the low IR policy permanently....... however,

This is where my 'energy story' comes in. In previous recessions the price of oil as not been the huge factor that it became in 2008 and will do again as soon as demand ramps. Other recessions didn't have to cope with peak oil and the inflation that rising prices due to demand overtaking production will bring to economies around the world.

We are on borrowed time. No if's, no but's. It's like a watching a car crash in slow motion.