will a nov rate rise affect you?

TJ27

I think our outstanding mortgage roughly equals our savings, so it shouldn't affect us in theory.

If it was up to me I'd be paying the mortgage off tomorrow but my other half will hear nothing of it!

Bunnyfluff_2

No, wouldn't affect me, as got a fixed rate mortgage, just be pleased that the savings rates would increase a bit more.

Gorgeous_George

Personally, a marginally negative effect on the face of it. £140K borrowed on trackers for two houses, one being a BTL. Only £40K in savings so every 0.25% increase costs me £250 per year.

I maintained the rent on my BTL at £75 since 2001 and only increased it to £80 last May. IThe market rate for similar properties is £100 per week so I could justifiably pass the whole of a 1% rise on to my tenants, but I wouldn't.

Those on short fixed term deals have most to lose (2 to 5 years). If rates don't fall by the time their fixed rates end, they could find that their homes are worth less than their mortgage and new fixed rates could be much higher than present.

My trackers will rise more steadily and the shock factor will be less.

With three kids, I'd be happy for a drop in house prices. Some of those who gloat may be less happy when any inheritance that they may receive will be lower. I'd need house prices to fall by 65% to put me in negative equity.

I suppose that with about £30k in endowments, the returns at maturity could benefit from IR rises. Maybe I'm a neutral.



GG

nearlyrich

I'm not gloating but I don't have a mortgage so the rate won't affect me at all, I agree that the institutions don't act very quickly to increase the interest rate on savings accounts.

Mrs_Optimist

Wont make any change to us either. if we were not on a fixed rate a quarter of a per cent increease would mean an extra £10 payment on our miniscule mortgage. Those occassions when we have been tempted to withdraw the equity on our home and splash the cash - but opted not to - have served us very well.

mystic_trev

This is quite interesting - most of us here wouldn't be bothered with an IR rise, and isn't this just the point? If IR's rise and there's a House price correction, it only affects a minority of people. This is what happened during the last crash, although the minorities were badly hit and will be again if the same happens!

CycloneUK_2

nearlyrich wrote:

I'm not gloating but I don't have a mortgage so the rate won't affect me at all, I agree that the institutions don't act very quickly to increase the interest rate on savings accounts.

Ditto same here, i'm buying outright so any increase will not effect me.

FaTB

TJ27 wrote:

I think our outstanding mortgage roughly equals our savings, so it shouldn't affect us in theory.

If it was up to me I'd be paying the mortgage off tomorrow but my other half will hear nothing of it!

Surely that is crazy ??

As you'll be paying more interest on your mortgage, than you are earning on your savings !

Xbigman

No effect on me. 13 months into a 7 year fix and overpaying 10% per year, mortgage will be less than savings by the time the fix ends.

Now what I would like to see is no more rate rises and inflation allowed to rise, thus reducing my mortgage in real terms.

This is quite interesting - most of us here wouldn't be bothered with an IR rise, and isn't this just the point? If IR's rise and there's a House price correction, it only affects a minority of people. This is what happened during the last crash, although the minorities were badly hit and will be again if the same happens!

Yes, but anyone reading this board is likely to be more money savvy than average, so you can't take a sample here as indicative of much.
Regards




X

Xbigman

FaTB wrote:

Surely that is crazy ??

As you'll be paying more interest on your mortgage, than you are earning on your savings !

No, if their mortgage rises .25 and savings rise .25 the relative position is the same. Although personally I'd pay off the mortgage and not care either way after that.
Regards


X