MSE News: Bank of Ireland to raise mortgage SVR

bingobob777

People who don't understand the difference between a SVR and tracker mortgage should be banned from having one, it's hardly particle physics.

The UK is full of morons unable to take responsibility for anything.

tawse57

I really feel for all those genuine people who were just looking to buy a home.

But I have no sympathy for those who saw buying property as a get rich scheme - that is all the second home owners, the flippers, the buy to letters, the mortgage advisers and estate agents.

All those now complaining about the mortgage rate rising ignore the fact that hundreds of thousands of people on fixed incomes living off pensions have been subsidising your low mortgage rate since 2008. They HAVE been suffering by getting no return on their savings AND seeing inflation eat away at their savings.

The reality is - as an economist said this week on Newsnight and a different economist said on the Andrew Neil show the same day - that the "UK mortgage timebomb is about to explode" because interest rates are going to go up and up.

If you think it is bad now wait 12 or 24 months.

The UK housing prices are probably about to crash in a way that most of us cannot imagine - most likely like the big US price crash as interest rates rise and people lose their homes.

I am not saying this to scare people but perhaps it will wake up some people. If you cannot afford this small rate rise then wait for the next one and the one after.

Perhaps some people will be better off thinking about selling up now and taking the loss now - rather than possibly a much bigger loss 12 or 24 months from now.

The banks need money and they are going to get it from all of you mortgage payers - they will raise interest rates until they are back around the long term average of 8 or 9 percent - or higher - IMPO. Consider yourselves warned.

ILW

bingobob777 wrote: »

People who don't understand the difference between a SVR and tracker mortgage should be banned from having one, it's hardly particle physics.

The UK is full of morons unable to take responsibility for anything.

Bit harsh, but it has surprised me the amount of posters on here who do (did) not seem to realise there was a difference.

Cassandra_W

The idea of low interest rates was to give people in too much debt the chance to

A) Sell their house while prices were kept artificially high a little bit longer to someone who could really afford to live there.

Pay down more debt against it so that when rates return to normal they have less debt to service at the higher rates.

The people moaning about being unable to afford mortgage rises now and the larger ones to come, are the people who have done:

C) Had their house on the market for 3 years but didn't reduce the price because their house is special and worth every penny. They just spent the extra money each month they got from their reduced mortgage payment because they thought low interest rates would last forever. When people kept saying interest rates were at a "300 year low".... it was supposed to be a clue that it wasn't going to last.

The people who did C) will be those who spent too much on a house because those nice people on the TV (one who had his own property firm that went bust) told them to bid near the asking price all the time.

If you cannot afford your mortgage now you need to sell your house a.s.a.p. before the payments get even higher and it is taken from you. Things aren't going to get any better interest rate wise and the exits that say "house for sale" are going to get very crowded.


A Minsky moment is the economic phenomenon that occurs when over-indebted investors are forced to sell good assets to pay back their loans, causing sharp declines in financial markets and jumps in demand for cash. In any credit cycle or business cycle it is the point when investors begin having cash flow problems due to the spiraling debt incurred in financing speculative investments. At this point no counterparty can be found to bid at the high asking prices previously quoted; consequently, a major sell-off begins leading to a sudden and precipitous collapse in market-clearing asset prices and a sharp drop in market liquidity.

kingstreet

Dave_Ham wrote: »

Ok - so started reading this thread against my better judgement.

Firstly as a person I have sympathy for everyone affected by this very high increase in costs.

However, picking fights with each other, the banks and somehow the IFA who sold you the original mortgage is not going to help anyone.

When you took out the mortgages originally they would have been these sorts of rates, so therefore should be affordable.

On a personal level, I have been happy to take the SVR for 3.5 years now and if and when mine goes up I will look at it as 3.5 years of good times rather than getting angry about something that I cannot change.

If they put it up too much, I will personally take my business elsewere.

If I were unfortunate and my circumstances were not marketable to other banks then that would be my issue and not the banks that I currently have a mortgage with.

Now you can all either personally attack my points (or spelling) or plan the best way to manage this increase - because it is going to happen and no amount of witch hunting will change that.

My first and last post on this thread... Dave

Couldn't agree more. Further, this thread has now got away from the purpose of this site, which is to help people save money.

I invest a considerable amount of time and effort trying to help people with issues they find complex. As GMS said, if he doesn't know about something, he asks an expert.

I don't have any kind of authority on here, but if I did, I'd say that from now on, stay out of this thread if you don't feel able to give help to those requesting it.

This should now be about solutions, not recriminations.

Please.

Cassandra_W

kingstreet wrote: »

Couldn't agree more. Further, this thread has now got away from the purpose of this site, which is to help people save money.

I invest a considerable amount of time and effort trying to help people with issues they find complex. As GMS said, if he doesn't know about something, he asks an expert.

I don't have any kind of authority on here, but if I did, I'd say that from now on, stay out of this thread if you don't feel able to give help to those requesting it.

This should now be about solutions, not recriminations.

Please.

:rotfl:

A mortgage broker doesn't want to talk about the cause of the problems that people face now. He wants people to try save a few pounds so that they can keep paying their mortgage.

:rotfl:

The problem is that some bank or mortgage broker persuaded them to get in too much debt but that hasn't to be mentioned!

:rotfl:

It reminds me of the Fawlty Towers episode with the Germans....

"Don't mention the war.... I mentioned it once but I think I got away with it"

:rotfl:

So helping people not take on too much debt so they don't get in the position where they have to make savings is a banned subject.... says the mortgage broker!!

:rotfl:

ingermany

ILW wrote: »

I don't think that any is taking pleasure from others mistakes. But your tone does seem to suggest that it is all someone elses fault.

If you think your IFA mislead you, you can sue them.

Problems:

1. you need proof
2. it takes time
3. it costs money
4. the outcome is a bit of a gamble

At the end of the day, current SVR is still very low (less than or close to RPI) so the banks are effectively giving money away for free.

the elephant in the room here is that people just weren't interested in the cost of the loan after 3 years because they believed that the house would have "made" 50-100k by the time the fix expired. The media, the press, peer pressure, Kirsty and Phil.........all conspired to deceive ordinary people about something that should have been obvious. And actually, when you read the mortgage offer paperwork and cautions, it is all in black and white. The SVR is whatever the bank holding the mortgage wants it to be. But people weren't bothered because they were told they "couldn't lose on bricks and mortar".

kingstreet

Cassandra_W wrote: »

:rotfl:

A mortgage broker doesn't want to talk about the cause of the problems that people face now. He wants people to try save a few pounds so that they can keep paying their mortgage.

:rotfl:

The problem is that some bank or mortgage broker persuaded them to get in too much debt but that hasn't to be mentioned!

:rotfl:

It reminds me of the Fawlty Towers episode with the Germans....

"Don't mention the war.... I mentioned it once but I think I got away with it"

:rotfl:

So helping people not take on too much debt so they don't get in the position where they have to make savings is a banned subject.... says the mortgage broker!!

:rotfl:

There I was thinking this thread's sole purpose had so far been for half the posters to complain about a rate rise, and the others half to recriminate with them over their lifestyle choices.

I have no problem talking about the causes of the problems. However we can actually do that AND help people as well.

By design, or by accident, the bulk of my clients, who've been with me for more than 10 years in most cases, are paying 2.5% to the likes of Nationwide and C&G and if they've paid any attention to what I've been saying, have been overpaying as much as they can.

After nearly 28 years in the industry, one self-cert case written in the five years upto October 2006 (and none after) and nothing written over four times income I don't feel responsible for the actions of others.

I don't however tell people what they should do, or what they shouldn't have done.

I still think it's time to move on from this thread.

suburbanwifey

ingermany wrote: »

[/B]

Problems:

1. you need proof
2. it takes time
3. it costs money
4. the outcome is a bit of a gamble

At the end of the day, current SVR is still very low (less than or close to RPI) so the banks are effectively giving money away for free.

the elephant in the room here is that people just weren't interested in the cost of the loan after 3 years because they believed that the house would have "made" 50-100k by the time the fix expired. The media, the press, peer pressure, Kirsty and Phil.........all conspired to deceive ordinary people about something that should have been obvious. And actually, when you read the mortgage offer paperwork and cautions, it is all in black and white. The SVR is whatever the bank holding the mortgage wants it to be. But people weren't bothered because they were told they "couldn't lose on bricks and mortar".

You're right! house prices kept rising and rising and have done for over a decade now. So, its not really the general public's fault or Kirsty & Phil really, it was mortgage lenders allowing bigger mortgages, higher lending multiples etc. was it not? its not the fault of Joe public who needed a house to live in, not his fault he had to pay those stupid prices to get a home or take on a ludicrous mortgage to pay for it, he had to do both those things as that is what houses cost.

ProperBo

i have a mortgage with BOI and can manage the hike to 4.49% but i'm hoping they don't start putting it up every 6 months. this has at least given me an incentive to start clearing my debts quicker and stop spending as much so i can create a better LTV and more options. i've applied for a 5 year fix with first direct who i've banked with for years and been turned down because of my outgoings. i'm trying to be positive and this may be the wake up call i needed. what is the general consensus about svr's in the climate for the next couple of years? do you think BOI will stop at 4.49%?