Mortgage Interest Rate Increases

de1amo

İ was once told to be nice to all mse users--some people need telling the realities straight!!

jbiwtt7

Gorgeous_George wrote: »

The institutions that needed bailing out did so because so many of their borrowers are wuckfits who borrowed too much (up to 125%) against an over-valued product.

This increased risk is partially reflected in the higher rates that they NEED to charge to borrowers.

If my lender kept rates artificially low I wouldn't bother paying the debt off. Instead I would save with other institutions who were able to offer better savings rates.

The customers of those (sub-prime lenders) that needed bailing out who cannot move to a lender with lower rates probably contribute less in taxes than the (indirect) benefits they have received from the bailout.

GG

Except that most of those individuals are probably hard working, law abiding, tax paying individuals who would not think to default on their payments who are sick of seeing people living on benefits having a higher standard of living than them without so much as lifting a finger never mind working all hours to improve themselves and their circumstances.

de1amo

i saw the late 80s price crash and resulted defaulting--it was all enveloping and non-discrimatry(sp) all the people caught up in the bubble crashed and burned--the others just saw their properties devalue along with every other property-only net change was the period of high mortgage costs-back then everything was svr for me-15pc with no options--i learnt from history seems few people have

[Deleted User]

de1amo wrote: »

i saw the late 80s price crash and resulted defaulting--it was all enveloping and non-discrimatry(sp) all the people caught up in the bubble crashed and burned--the others just saw their properties devalue along with every other property-only net change was the period of high mortgage costs-back then everything was svr for me-15pc with no options--i learnt from history seems few people have

I also lived through this and the 1987 stock market crash. It has shaped my attitude to financial risk ever since. Having to struggle financially provides valuable lessons because you always want to avoid being in that situation again.

Thrugelmir

jbiwtt7 wrote: »

With respect to your opinions I should perhaps amend that original statement and further clarify it.

I am talking about institutions such as Northern Rock for instance whose customers have seen very little benefit from base rate changes, maybe 0.5% - 1% decrease in total.

I believe that their interest rates should not be allowed to increase until they are in line with the average rates offered by all other financial institutions which offer competitive interest rates. That is to say that they should not be allowed to profiteer at the risk of people losing their homes, not through lack of financial planning but through extortionate rate increases out of line with other financial institutions.

So although they might not make as much money they would reduce the risk of defaults and repossessions.

Thats because NR securitised a large % of their mortgage book and sold it on. While NR administer the mortgages , they have to pay the investors for borrowing the money.

Which NR has your mortgage been transfered to? Good or bad bank.