anyone else want a CRASH...?

meanmachine_2

cwcw wrote:

PS. I wasn't implying YOU had a vested interest, but I can certainly think of some persistent offenders on this board.

The biggest repeat offender is you who continues to ignore mortgage arrangement fees, opportunity costs, maintenance costs, annual charges, solicitors' fees, stamp duty and god knows what else in their efforts to make the price to rent ratio make sense right now.

Ian_W

Hi Alan,
Don't want to get into the will it/won't it/when scenario but your questions re mortgages are:
1. https://www.moneyfacts.co.uk/mortgages/bestbuys/100.aspx
2 & 3. https://www.moneyfacts.co.uk/mortgages/bestbuys/fixed_noext.aspx
or https://www.moneyfacts.co.uk/mortgages/bestbuys/ftb_disc_var.aspx
In reality I don't think there is much difference these days in what's available with a 30% deposit to a 10% one - however it may affect underwriting on an individual basis. Less than 10% deposit the lender usually charges a "higher lending fee" which you may remember as a MIG [Mortgage Indemnity Guarantee] and 100% mortgages are always at a higher rate, though not normally as high as 6.5%. A poor credit history may put you around that level but I think most mainstream lenders these days allow some adverse history w/o penalty.

So there are plenty of mortgages in the <5-<6% range and anyone these days on SVR is either incredibly silly OR has such a small mortgage that the fees mean getting a better rate just isn't worthwhile.

If the majority of mortgages are SVR - I doubt it but honestly don't know - they're not likely to be ones where an interest rate rise of even several % is likely to be a significant problem. It's quite different to the early 90's when there were very few fixed, discounted deals around and over 95% of mortgages were at lenders SVR when an overnight 2% increase caused real pain.

Alan_M_2

So between 5% and 6% fixed for two years is realistic, thanks for the links.

cwcw

Alan_M wrote:

So between 5% and 6% fixed for two years is realistic, thanks for the links.

ING Direct do 4.95% fixed for 2 years and their SVR is low too. My mortgage is 4.89% fixed.

cwcw

meanmachine wrote:

The biggest repeat offender is you who continues to ignore mortgage arrangement fees, opportunity costs, maintenance costs, annual charges, solicitors' fees, stamp duty and god knows what else in their efforts to make the price to rent ratio make sense right now.

I'm not ignoring anything. I've acknowledged them on several occasions.

I_Claudius

there are a large range of surprisingly good, very long term fixed mortgages around right now

Kent Reliance, 25 year fix at 4.98%

http://www.krbs.co.uk/25yrfix75.aspx

Woolwich, 10 year fix at 4.98%

http://www.personal.barclays.co.uk/BRC1/js...1&menu=5042

these must be appealing to those looking at the bigger picture and who are in it for the long haul

Alan_M_2

So how do these firms make money lending you money at less than base rate?

Exactly how much are you paying in fees for this kind of deal and I'd assume there are penalites or you reach a point where you have to pay a higher rate?

Ahh first link was with a minimum 25% deposit, so low risk - I get that - not what you call a FTB mortgage. Any less than that it's 5.5%

Second link didn't work.

cwcw

But even so, the banks must be pretty confident that base rates aren't going to reach much higher levels than they are now, or else they wouldn't be offering such long term fixes.

Ian_W

Alan_M wrote:

So how do these firms make money lending you money at less than base rate?

Exactly how much are you paying in fees for this kind of deal and I'd assume there are penalites or you reach a point where you have to pay a higher rate?

Ahh first link was with a minimum 25% deposit, so low risk - I get that - not what you call a FTB mortgage. Any less than that it's 5.5%

I don't know but Banks/BS's they don't do it to lose money do they? But rates at or even below BoE BR have been around for a hell of a long time.

Typical fees over and above the fees you'd pay for any remortgage are £4-600 and fixed rates always have penalties but many discounted variables don't.

If you look at the links I posted at 2&3 I think you'll find most are available up to 90 or even 95% LTV so they are very much FTBer territory as, of course, are 100% ones.

Hereward

Ian_W wrote:

Hi Alan,
Don't want to get into the will it/won't it/when scenario but your questions re mortgages are:
1. www.moneyfacts.co.uk/mortgages/bestbuys/100.aspx
2 & 3. www.moneyfacts.co.uk/mortgages/bestbuys/fixed_noext.aspx
or www.moneyfacts.co.uk/mortgages/bestbuys/ftb_disc_var.aspx
In reality I don't think there is much difference these days in what's available with a 30% deposit to a 10% one - however it may affect underwriting on an individual basis. Less than 10% deposit the lender usually charges a "higher lending fee" which you may remember as a MIG [Mortgage Indemnity Guarantee] and 100% mortgages are always at a higher rate, though not normally as high as 6.5%. A poor credit history may put you around that level but I think most mainstream lenders these days allow some adverse history w/o penalty.

So there are plenty of mortgages in the <5-<6% range and anyone these days on SVR is either incredibly silly OR has such a small mortgage that the fees mean getting a better rate just isn't worthwhile.

If the majority of mortgages are SVR - I doubt it but honestly don't know - they're not likely to be ones where an interest rate rise of even several % is likely to be a significant problem. It's quite different to the early 90's when there were very few fixed, discounted deals around and over 95% of mortgages were at lenders SVR when an overnight 2% increase caused real pain.

I wouldn't call anybody that has a poor credit rating stupid. The rates that were on the links supplied would apply to someone with a good credit rating, they would be more if they had a lower credit rating. A comparison to the SVR is a good idea as it would demonstrate a continuing analysis of Rent vs. Mortgage (just because there are plenty of remortgage deals around now, doesn't meant they will be available tomorrow, when your current deal runs out).

I believe the majority of mortgages are on the SVR because people have forgotten to renew their deal or believe that it too much hassle to change mortgage providers.