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Debate House Prices
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Mortgage rates going up
Comments
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SecondLegDownIsTheBigOne wrote: »Because I bought my first house 14 years ago, I'll never have to pay that much per month for my mortgage. Is that because I'm a smart and savvy homeownerist genius?
A large element of it is probably that you are older than a lot of the people who bought more recently.Do you know anyone who's bereaved? Point them to https://www.AtaLoss.org which does for bereavement support what MSE does for financial services, providing links to support organisations relevant to the circumstances of the loss & the local area. (Link permitted by forum team)
Tyre performance in the wet deteriorates rapidly below about 3mm tread - change yours when they get dangerous, not just when they are nearly illegal (1.6mm).
Oh, and wear your seatbelt. My kids are only alive because they were wearing theirs when somebody else was driving in wet weather with worn tyres.
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You seem to forget that it`s mainly the savers who provide the money for the mortgages.
And yes banks and building society bosses do worry about saving rates.
That was one of the main factors that RBS/Halifax took into consideration for the increase of it`s SVR.
Banks are trying to get on a firmer footing by attracting money from savers. However, they'll only pay the minimum they need to do this. Unless the banks are planning major mortgage expansions I doubt very much whether they intend to pass a single penny back to savers just yet. Why? Because at current lending volumes they can find plenty of people who will accept the savings rates on offer plus they can dip into central bank money (now with no stigma attached) that's even cheaper.0 -
SecondLegDownIsTheBigOne wrote: »Because I bought my first house 14 years ago, I'll never have to pay that much per month for my mortgage. Is that because I'm a smart and savvy homeownerist genius?
Er no, it just means that you probably have a lot of equity built up in your house and that due to inflation your wage/mortgage payment ratio is a lot better now than when you first took out the mortgage.
Imagine if you had rented your house 14 years ago instead of buying it, would you still be paying the same rent now?0 -
black_taxi wrote: »one of the reasons halifax gave 2010 is that they dont have enough savers--and you wonder why
UK savers vastly outnumber mortgage borrowers but unless the rates are improved for them they`ll look elsewhere.
A lot of older savers look for a monthly income from their savings simply to get by each month.
For the last 3 years the BoE have kept their rate at 0.5% simply to subsidise mortgage borrowers, who they hope will spend the surplus cash, that they really should be paying on their mortgages, in the high street to keep the economy from going under.
If mortgage borrowers had any sense they would use the surplus cash each month to get their mortgages down.
http://www.huffingtonpost.co.uk/2012/03/04/bank-of-england-to-keep-interest-rates-on-hold_n_1319446.html?ref=uk
With the UK still in danger of recession, economists say there is no chance the Bank will hike interest rates from rock-bottom on Thursday, although it is not expected to print more money until its last £50 billion injection works its way into the system.
They predict more bad news for savers, as it may be years until interest rates are hiked, while there is division about whether more QE will be needed in future months.
The Bank's stimulus measures have been a blessing for homeowners with variable rate mortgages but for savers they have been a disaster because interest rates have failed to keep up with inflation.
The QE programme has delivered an additional blow to pensioners by dragging down annuity rates, which set the size of their pension for life.
Annuity rates are linked to Government bonds, which have seen their interest rates fall as the Bank uses its freshly printed money to buy them, driving up demand.
The National Association of Pension Funds (NAPF) recently hit out at the Bank's decision at its February meeting to increase its QE programme to £325 billion.
It said retirees would find that annuity rates, have been "squashed" by QE, leaving those approaching retirement in pain for the rest of their lives.
It would also cause a "headache" for companies running final salary pensions by increasing deficits by billions of pounds and could lead to more schemes being shut.
The squeeze for savers and pensioners has been made worse because the cost of living has been above the Bank's 2% target in recent months.
The Bank's governor Sir Mervyn King has repeatedly expressed his sympathy for savers but has said the stimulus measures were needed to help the economy.
£325 BILLION down the drain.0 -
Graham_Devon wrote: »If it's so easy...tell me. Let's say I have a 90% LTV. I'm on SVR. Which tracker should I switch to in order for me to become "less lazy"? Show me the product.
Distint lack of answers on that one as expected then.0 -
UK savers vastly outnumber mortgage borrowers but unless the rates are improved for them they`ll look elsewhere.
A lot of older savers look for a monthly income from their savings simply to get by each month.
But most of them won't look elsewhere. A lot of savers, and particularly older savers, don't want risk. A typical "smalltime" older saver has a comparatively small amount of savings and wants it to make their retirement a bit more comfortable. They have little experience of investments, and the idea of putting their money into something that could go down instead of up is not appealing, particularly when the economy is not at its strongest. They don't want to invest in foreign banks, either, or precious metals, or anything else, and even if they did think of it, they wouldn't know how.
They want a straightforward sterling savings account, protected by the FSCS, where they can put their little nest-egg and not have to worry about it. They also want to know they can get at their money easily if circumstances change and they need it. Most of them don't even have the mind-set to keep ditching and switching to maximise their interest, and even the ones that are willing to do that haven't got many options because all the British banks are offering pretty similar pathetic rates.
I'm not trying to say that all older savers are like that. Of course there are plenty of older people who've been playing with investments all their lives and are still doing it in retirement. But as long as there's a critical mass of the unadventurous type of older saver that I've described, then the banks will still get savers putting money in even if the rates are pitiful.Do you know anyone who's bereaved? Point them to https://www.AtaLoss.org which does for bereavement support what MSE does for financial services, providing links to support organisations relevant to the circumstances of the loss & the local area. (Link permitted by forum team)
Tyre performance in the wet deteriorates rapidly below about 3mm tread - change yours when they get dangerous, not just when they are nearly illegal (1.6mm).
Oh, and wear your seatbelt. My kids are only alive because they were wearing theirs when somebody else was driving in wet weather with worn tyres.0 -
There is absolutely no guarantee that this will happen. The banks are more interested in looking after their own margins than your "pensioner with a nest egg" scenario.
That's why I followed by saying.......Obviously, that is not always the case, and it is a little more complex than that.
If lenders are struggling to raise funds for lending on the markets, they may just turn to savers.30 Year Challenge : To be 30 years older. Equity : Don't know, don't care much. Savings : That's asking for ridicule.0 -
I dont know why savers keep moaning. A friend of mine has stuck a lump sum in a Turkish bank and has been getting massive saving rates for years.
Why dont you do the same?We love Sarah O Grady0 -
Graham_Devon wrote: »Distint lack of answers on that one as expected then.
I gave you an answer. Options are limited and possibly non-existent. The time to do something about getting the shaft is before it's inserted. That was explained clearly.
You can't expect to be complacent for years and then suddenly decide that you won't be complacent any more without there being a penalty for that past complacency.
A lesson learnt I hope.0
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