The 25 year fixed rate mortgage returns to the UK market....

gagahouse

Thrugelmir wrote: »

How does this connect to a 25 year mortgage product?

Quite a lot, fixed mortgages are priced as a spread over swap rates which in turn are priced as a spread above the Gilt rate.

Typically the bank will borrow at 3m Libor, then do an interest rate swap with another dealer bank where they will receive 3m Libor and pay fixed. If fixed is 4%, they will charge customer a spread over that.

loumini

It will still be a big ask to pay rent and save up for a deposit

Loughton_Monkey

HOMEOWNING_FTW wrote: »

Some people will simply never ever buy. It doesn't matter how much help, support, and incentives their boomer parents, the state and banks happily provide them. These people are essentially lifes lossers, unable to believe in themselves or their own futures to realise the dream of homeownership. It's sad and pathetic really but it essentially seperates the boys from the men.

Understood.

A 'losser' being (presumably) a cross between a loser and a !!!!!!?

sabretoothtigger

Graham_Devon wrote: »

Paying a premium? Sounds like a steal to me.

Can be taken as an interest only loan too, at 5.99%.

Wonder if this is like the HSBC great deal which had a tiny amount of funds?

My first thought is similar, thats an amazing rate to fix for so long. The biggest bonus is the LTV, best deal Ive heard in a long time and makes 5yr fixes like xmas cracker dittys in comparison

HAMISH_MCTAVISH wrote: »

Fill yer boots then Dev...

30 year fixes in the US are 3.5%, and given the likely trajectory of rates here over the next decade or more, no reason why they should be any higher here.

90% of USA mortgages are backed by government. We are the wild west in comparison to that socialist paradise

oldvicar

Morgage_Confused wrote: »

WOW....check out their long term fix BTL products.....great rate and low fees, they knock TMW into a cocked hat!!

WOW.... I did....a licence to print money if ever I saw one.

Thrugelmir

gagahouse wrote: »

Quite a lot, fixed mortgages are priced as a spread over swap rates which in turn are priced as a spread above the Gilt rate.

Typically the bank will borrow at 3m Libor, then do an interest rate swap with another dealer bank where they will receive 3m Libor and pay fixed. If fixed is 4%, they will charge customer a spread over that.

Building societies such as the Manchester don't have access to borrow at LIBOR. They are reliant on the wholesale money markets.

gagahouse

Thrugelmir wrote: »

Building societies such as the Manchester don't have access to borrow at LIBOR. They are reliant on the wholesale money markets.

Libor is one part of the wholesale money market, building societies can borrow from a mix of deposits and money markets. Some choose to fund entirely from deposits (expensive), some a mixture, it is not clear from linked article the situation for MBS.

http://www.bsa.org.uk/faq/mortgagerate.htm

Conrad

I recently had clients in that wanted me to help them build a mis selling case against the Nationwide for flogging them a long term fixed rate, which they now cannot escape without a large penalty. They are getting divorced and thus have to sell up and pay the penalty.

These long term fixed rates are all very well until it comes to a life changing event.

As a broker I fear being sued and thus would never advise one of these.

Thrugelmir

Conrad wrote: »

I recently had clients in that wanted me to help them build a mis selling case against the Nationwide for flogging them a long term fixed rate, which they now cannot escape without a large penalty. They are getting divorced and thus have to sell up and pay the penalty.

These long term fixed rates are all very well until it comes to a life changing event.

As a broker I fear being sued and thus would never advise one of these.

This product only has a limited tie in period.

shortchanged_2

Conrad wrote: »

I recently had clients in that wanted me to help them build a mis selling case against the Nationwide for flogging them a long term fixed rate, which they now cannot escape without a large penalty. They are getting divorced and thus have to sell up and pay the penalty.

These long term fixed rates are all very well until it comes to a life changing event.

As a broker I fear being sued and thus would never advise one of these.

Why though? If the terms of the mortgage are clearly pointed out to them then they have nothing to complain about.

Nobody is forcing them into the deal and as long as they are well informed they can then make an informed choice.

Why do people sign contracts for such large transactions that they have no clue of the terms? It just seems ludicrous really, why don't more people accept responsibility for their actions.