Mortgage Rates May Hit 14% Within Two Years

Graham_Devon

Hindsight is a truly wonderful thing.

wotsthat

mwpt wrote: »

If mortgage rates hit 14% I'd have to pay of a big chunk of equity but I could manage the repayments. I wouldn't sell unless I really had to, because I live in my home.

I'd try to work extra hard and and trade up at the reduced prices though. There would be some sellers around.

My stance is unchanged, ultra low base rates should not have been allowed to feed through into the mortgage market.

I might have a rekindled desire to enter the 0% credit card World Championships.

When I was paying a c5% mortgage I managed to keep circulating a min £20k credit balance for years. That was when there were no balance transfer fees - truly free money - happy days.

I'm delighted low rates became available. I tend to prefer paying less for the stuff I buy.

Thrugelmir

QE is still playing out. Seems as if over priced assets was the outcome with negligible inflation to show for Central Banks efforts. shows how the bad the true financial position actually was. RBS still writing down assets on it's balance sheet some 8 years later tells a tale in itself. Now Lloyds share sell off deferred.

wotsthat

Graham_Devon wrote: »

Hindsight is a truly wonderful thing.

It is.

Hindsight allows us to revisit past predictions to see how accurate they are and, possibly, help us in the future to try and distinguish between an informed prediction (right or wrong) and pure clickbait.

Surely you review some of your past decisions to see if they were as effective as you thought they'd be at the time?

Delete33

No lessons have been learned, banks are still selling debt to people who can not afford it. The Bubble will burst again, then we will all be in the S-it.

N1AK

Graham_Devon wrote: »

Hindsight is a truly wonderful thing.

Something that amuses me each time a new Trump related story comes out on the BBC. There was one the other day saying that his success so far shouldn't surprise anyone... Easy to say that now, but not merit worthy if you couldn't predict it in advance.

There seems to be something fundamentally wrong with the whole model of experts and forecasts. People and/or stories with outlier views are seen as more interesting and get more coverage. We know that these are less likely to be true than more moderate views, but the same BS merchants get invited back on TV or to write articles.

Oddly the current commodity price falls could make a period of high inflation more likely. We're seeing inflation held down by them now, but if fuel went back up to pre-fall levels quickly we'd likely see considerable inflation.

danothy

Crashy_Time wrote: »

If mortgage rates hit 6% many on here are toast anyway.......:rotfl:

Specifically, who are the "many" on here who will be toast if rates hit 6% and how do you know so much about their circumstances? Is your information about them from the same source as your information about Fergus, for example?

mwpt

wotsthat wrote: »

I might have a rekindled desire to enter the 0% credit card World Championships.

When I was paying a c5% mortgage I managed to keep circulating a min £20k credit balance for years. That was when there were no balance transfer fees - truly free money - happy days.

I'm delighted low rates became available. I tend to prefer paying less for the stuff I [strike]buy[/strike]bought.

I corrected that for you. Lower rates mean price of asset goes up. This is well understood, well known. If you were lucky enough to buy at higher rates you'd have seen your payments come down as rates fell and your asset price go up. Rates climbing will have the opposite effect of course. Mortgage repayments track rents very closely (evidence on another thread somewhere) so people buying today do not pay significantly less per month as a % than previously but have a great big pile more debt that is harder to pay down on overpayments. See my other post.

All pretty standard, quite well known stuff.

I've never done the credit card stooge stuff but I may look into it.

michaels

wotsthat wrote: »

It is.

Hindsight allows us to revisit past predictions to see how accurate they are and, possibly, help us in the future to try and distinguish between an informed prediction (right or wrong) and pure clickbait.

Surely you review some of your past decisions to see if they were as effective as you thought they'd be at the time?

It is a tricky one though - If I look back almost every 'mistake' I made was not to go long property sooner or with more leverage - but then I have only really been in a position ot take financial decison of that sort since 1995. In other words past performance is not neccessarily a prediction of future returns......

wotsthat

mwpt wrote: »

I corrected that for you. Lower rates mean price of asset goes up. This is well understood, well known. If you were lucky enough to buy at higher rates you'd have seen your payments come down as rates fell and your asset price go up. Rates climbing will have the opposite effect of course. Mortgage repayments track rents very closely (evidence on another thread somewhere) so people buying today do not pay significantly less per month as a % than previously but have a great big pile more debt that is harder to pay down on overpayments. See my other post.

It didn't need correcting.

I doubt I'm alone. If someone has a mortgage their preferred direction of mortgage cost is down. I extended my mortgage out to retirement and used the unpaid capital to increase my pension payments.

I'd be a lot worse off if my mortgage was 14% - why would I want that.