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Cuts and interest rate rises
thela1
Posts: 4 Newbie
Getting slightly worried in the current climate with cuts and interest rate rises possibly/probably on the way.
The wife and I bought our place at the top of the market, with a 2 year fixed-rate Alliance & Leicester mortgage. This was interest only. At the end of the fixed rate, because of the crunch, we had no chance of affording the required deposit in order to get on to another fixed rate deal (places wanted 20% deposit!! - we'd bought our house with just 5%). So we stuck on the A&L SVR, interest only. Annoyingly, A&L have high SVR of 4.99, which they've refused to lower - despite their new parent company Santander offering 4.15%!
I'm just getting a bit worried! The talk is that interest rates will be rising sooner rather than later. Is it likely that A&L will add any interest rises onto their SVR, or will the fact they've kept theirs fairly high mean that they don't put it up as much?
It's a bit scary that as my wife and I both work in the public sector, our salaries could be cut in the proposed budget, and then we could see our mortgage payments rise around the same time. We don't want to lose our home! We've been trying to save - but we had a tough year in which our boiler broke (£2k!), we had to replace our car, and we did our kitchen up. We're saving again now, but again, we have nowhere near enough to get onto a fixed rate mortgage - so we're at the mercy of the SVR!
Anyone have any insight? Or is it just a case of wait and see? I guess one option might be to borrow some money from relatives (in-laws have some tucked away) in order to cover a deposit?
The good news is - aside from our mortgage and students loans - we are in absolutely no debt whatsoever. But ideally we'd like it to stay that way!
The wife and I bought our place at the top of the market, with a 2 year fixed-rate Alliance & Leicester mortgage. This was interest only. At the end of the fixed rate, because of the crunch, we had no chance of affording the required deposit in order to get on to another fixed rate deal (places wanted 20% deposit!! - we'd bought our house with just 5%). So we stuck on the A&L SVR, interest only. Annoyingly, A&L have high SVR of 4.99, which they've refused to lower - despite their new parent company Santander offering 4.15%!
I'm just getting a bit worried! The talk is that interest rates will be rising sooner rather than later. Is it likely that A&L will add any interest rises onto their SVR, or will the fact they've kept theirs fairly high mean that they don't put it up as much?
It's a bit scary that as my wife and I both work in the public sector, our salaries could be cut in the proposed budget, and then we could see our mortgage payments rise around the same time. We don't want to lose our home! We've been trying to save - but we had a tough year in which our boiler broke (£2k!), we had to replace our car, and we did our kitchen up. We're saving again now, but again, we have nowhere near enough to get onto a fixed rate mortgage - so we're at the mercy of the SVR!
Anyone have any insight? Or is it just a case of wait and see? I guess one option might be to borrow some money from relatives (in-laws have some tucked away) in order to cover a deposit?
The good news is - aside from our mortgage and students loans - we are in absolutely no debt whatsoever. But ideally we'd like it to stay that way!
0
Comments
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So with student loans you have a degree and are not working as a kitchen assistant at the local hospital!
5% deposit and interest only mortgage and bought 2 years ago not good is it.
You need to use Martin,s website to get best value for money from everything you spend money on.
cut your spending and save more, then overpay the mortgage big style.
I have been paying nearly 5% for the last 5 years and have cut my mortgage debt in half0 -
Does interest the rate on your savings exceed that of your mortgage ?
However small to start with, you need to tighten your belts and repay the capital balance on your mortgage.0
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