Interest Rates: Everything you ever wanted to know Article Discussion

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  • Kernow_Kid
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    Just to say, Halifax have said that they publish the interest rates in the press and on TV and in the branch (no they don't), and that they send out a letter each year stating their rates, so they are not going to back date my interest.:(
    Nothing ventured nothing gained. But still dissapointed.
    Be Pure, Be Vigilant, Behave!:A
  • valelodge
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    Hi there

    Have a question and I wonder if anyone can help??!!

    I have a new all singing all dancing Offset Mortgage from Standard life, current interest rate 5.95% APR.

    I also have some savings (approx £20,000).

    Is it better for me to invest the savings in a high interst svings account e.g. ICICI bank 6.30% AER (as from end of May)

    OR
    offest them against my mortgage at 5.95 AER!!!???? i AM NOT SURE HOW TO COMPARE THE 2 RATES!

    Furthermore I now am a non-tax payer so I will receive my interest gross on my savings.

    Any help you could provide would be most welcome.

    Thanks
  • jamesd
    jamesd Posts: 26,103 Forumite
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    Since you are receiving interest gross your after-tax interest rate for savings willl be 6.30% which is higher than your mortgage rate so you'll be a bit better off putting the money in the savings account.
  • Mike_D_5
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    Justine_M wrote: »
    I had a salesman from Dolphin bathrooms 'round last weekend. He quoted me £9,000 for a new bathroom if I took out finance with GE Capital, when I said I was wary of taking finance and would rather wait until I had saved up (how long would that take!) he said if I paid without the finance option the bathroom would cost me £10,116.
    I asked him what the APR was and he said I didn't really mean the APR, what I meant was the interest rate, which was 19%, but having a sneaky look at his paperwork, the APR was quoted as 24%.:confused:
    Can anyone help me understand this? Is it really cheaper to take the finance (over 10 years but you can pay it off at any time, monthly amount 'roughly' £160.) Why did he choose not to tell me the APR? Why do I feel like he's manipulating me! Is he in breach of the FSA to not disclose the APR or provide me with any breakdown of how he got to the £9,000 figure?
    In the end I had to give him a cheque for £100 to 'hold' the price whilst we thought about our options. It was the only way he was going to leave, after 3 hours! :eek:
    THANKS!
    Don't do it....

    The same happened to me with Sharps Bedrooms (Part of Same Co I think) The goods came to £2800 take the finance it went down to £2400. That was in 2001 six years ago, the monthly interest rate was 1.22% sounds good eh, wrong, after paying £38.00 per month by d/d (Clever because you don't notice it) I still owe £1500 !!! So I have paid £2,736 more than the loan amount, but still owe £1,500 which will be zero in FOUR YEARS TIME!!

    The company financing it was First National who sold it to GE Money Home Lending, on the original agreement it does not mention how much in total you will have to pay back either

    I asked them after waiting 15 mins on a 0870 line why I hadn't received a statement, they actually only sent them out every 18 months, which I didn't receive either.

    The only reason I had their number is they have written to me once telling me the interest rate is raising.

    ROBBING CORPORATE THEIFS, I FEEL SORRY FOR THE VUNRABLE THEY PREY ON

    THIS MUST BE ILLIEGAL?

    MARTIN YOUR COMMENTS
  • feeby007
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    [quote feeby007
    :confused::confused::confused::confused::confused::confused::confused::confused::confused::confused::confused::confused:

    we have a mortgage of 70,000. our mortgage is due for renewal at the end of the year. interest rates for mortgages are getting higher and offer short deals only (generally 2, 5 years).

    we really think it would be wiser to get a loan that has a lower interest rate (6.1%) for 70,000, pay off the mortgage with that and then pay back the loan at a fixed rate for the same amount every month and over the same amount of time as what the mortgage would have been? doing this is also saving on the monthly payments as well.

    what we like the idea of is paying a fixed amount for a long period of time. our life insurance is lump sum payout of 70,000 so if anything was to happen this could pay off the loan. we have spoken to various people and have recieved conflicting advice. the main one that seems to keep coming back is if you have alot of money, this would be a good idea. if it was this easy other people would be doing it right? so what would the catch be?

    we hope you can help martin

    feeby007




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    PS IF THIS ISN'T EVERYTHING YOU WANTED TO KNOW AND THERE'S MORE... THEN ASK ABOUT IT BELOW AND I WILL TRY AND ADD IT WHEN I DO AN UPDATE.... Martin
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  • jamson322
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    MSE_Martin wrote: »
    articlealert.gif




    Can anybody tell me if there is a simple calculation to work out the AER on a given sum of money saved? E.G. if I had £10,000 saved in an account offering 5.5% AER and was thinking of transferring this to an account offering 6%, is there a simple calculation that will tell me what the difference in interest would be so that I can decide whether it is worth the hassle to switch?
  • mikeyj_3
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    how much interest would i earn from 2500 pounds with a aer rate of 3.34% gross with the interest paid monthly
  • jamesd
    jamesd Posts: 26,103 Forumite
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    Is it in a tax free account? If not, what tax rate applies to your savings income, 20% or 40%?

    The practical answer is: not enough, that's a poor rate.
  • bunnyhop_2
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    Hi,
    Can anyone take pity on me in my ignorance of maths and finance and answer this, please? I was looking at the Britannia Regular Saver Account with a 7.5% AER if you put in a fixed monthly amount of your choice between £25 and £250. I wondered how to calculate the actual amount of interest I would get at the end of the 12 months, if I put various amounts in. I would prefer to invest a smaller amount as I don't have much spare, but if it is going to yield too small an amount in actual dosh, I won't bother. It says on the website that the interest is added at the end of the term.

    Thanks!
    I can't believe I don't know this :)
  • bill_wright_2
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    Dear Martin
    I note with interest your remarks on Regular saver accounts. according my workings a regular saver putting £100 per month into a regular saver for a fixed 1 year at 8% with HSBC would only return £52 and at 7% with Halifax £45.50 as against leaving your money in a savings account at 5% on £1200 would be £60. so it would not be beneficial to transfer payments to regular saver account. Its a bit of a fast one do you not think. Would I be right.:confused:

    Bill Wright
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