MSE Ness: Home owners told to prepare for 5% base rate

This is the discussion thread for the following MSE News Story:

"A member of the Bank's rate-setting committee says officials want the 0.5% rate to rise to a level 10 times as big ..."
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Comments

  • TonyMMM
    TonyMMM Posts: 3,376 Forumite
    Name Dropper First Post First Anniversary
    The sooner the better ... have been kept artificially low for far too long.
  • opinions4u
    opinions4u Posts: 19,411 Forumite
    They should already have built a cushion in to their finances to prepare for it. But I bet 90%+ haven't.

    It isn't happening any time soon though.
    "So, obviously, we would not be putting up rates so quickly as to cause a negative reaction. That's something we can try to anticipate and build in. So we would put rates up, see what the effect is and then judge how quickly to go."
  • They are going to have to raise this in very small chunks though as this is going to have a big impact on peoples finances, as often mortgages make up a huge percentage of peoples outgoings. Raising it quickly will mean that many people will struggle to adapt and cope, as a lot of people are struggling to keep their heads above water as it is.
    MFW 2011 challenge - Aim: Overpay £414.26 a month/£5,000 a year. Overpayment Total to date: £414.26:jMortgage start 28/9/07 £46,217.00 :TMortgage balance as of 25/05/11 £24,490.58 :T
    Interest saved as of 25/05/11: £2,849.84 Projected term reduction as of 25/05/11: 9 years 11 months
  • beecher2
    beecher2 Posts: 3,677 Forumite
    First Post First Anniversary Combo Breaker
    Anyone who hasn't prepared a plan for when rates return to normal is going to be in a lot of trouble at some point in the future. I doubt they'll pay attention to warnings at this stage.
  • nzseries1
    nzseries1 Posts: 2,240 Forumite
    That headline gave me the biggest smile on my face that I've had in a week. If they would do it next month it would be the best christmas present ever.
    You're spelling is effecting me so much. Im trying not to be phased by it but your all making me loose my mind on mass!! My head is loosing it's hair. I'm going to take myself off the electoral role like I should of done ages ago and move to the Caribean. I already brought my plane ticket, all be it a refundable 1.
  • nzseries1
    nzseries1 Posts: 2,240 Forumite
    beecher2 wrote: »
    Anyone who hasn't prepared a plan for when rates return to normal is going to be in a lot of trouble at some point in the future.

    And honestly, do you think that's going to be many people? I've read so many posts on this forum saying "must buy now, must buy now"
    You're spelling is effecting me so much. Im trying not to be phased by it but your all making me loose my mind on mass!! My head is loosing it's hair. I'm going to take myself off the electoral role like I should of done ages ago and move to the Caribean. I already brought my plane ticket, all be it a refundable 1.
  • JimmyTheWig
    JimmyTheWig Posts: 12,199 Forumite
    Name Dropper First Post Combo Breaker First Anniversary
    So I guess this is suggesting the worst thing you can go for now is a tracker with tie-in penalties? I think you'd be better off on SVR than getting a tracker now.
  • A welcome return to "normal" times.
  • betman
    betman Posts: 171 Forumite
    First Post First Anniversary Combo Breaker
    G R E A T about time for poor savers who have been hit hard for so long. After all fairs fair.
  • LilacPixie
    LilacPixie Posts: 8,052 Forumite
    Did anybody actually think they would stay at 0.5% forever??? I would hope not. It has always been a question of when and how quickly rates rise.. I would guess probably 0.25 rises every second month or so to allow those who havent prepared to 'adjust' budgets and avoid a mass stop in other spending.

    If that is the way they play it it could be years until rates are a 'normal' 5%
    MF aim 10th December 2020 :j:eek:
    MFW 2012 no86 OP 0/2000 :D
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