Yet another BOE warning shot across over debted homeownerss heads

alexlyne

I'm the first to admit that I am not knowledgeable in the history of interest rates vs mortgages, but...
in 2005 I got a mortgage, 90% for 5.4% when the base rate was around 5% and the SVR was 7.4%
Moved in 2009 and got some more of a different product, 90% again and this time at 6.3%, when base rate was 0.5% (Or maybe it hadn't droped that low, i can't remember), and SVR was 3.5-4%. (Both are 5 year terms)

So, if interest rates go up, then perhaps it may suggest strength in the economy so swap rates drop (in relation to the BR), so fixed rates remain relatively affordable? But probably not to the level they were in 2005 cos the banks have to find their profits PLUS the amount they owe the government (i.e. taking money from us twice).

please correct me if i'm wrong...

DervProf

chucknorris wrote: »

Who are these people who have over borrowed?

Well, I supsect one or to of his...........

http://www.bbc.co.uk/newsbeat/12306735

........ customers might fall into that category.

Sibley

I can't be bothered to find about a million linked articles supporting the fact that interest rates will not be rising.

It's going to be years before we see rates at 5%.

Nobody in the real world would argue that fact.