Interest Rates going back up to normal levels again?

Thrugelmir

sevenhills wrote: »

What will be a 'normal' rate with a Jeremy Corbyn Government?

Depends how much he needs to borrow to fund his plans? US Treasuries now offer 3%. While UK 10 Gilts offer 1.27%. I know which I'd buy first.

Crashy_Time

ilovehouses wrote: »

I first purchased in the early nineties when (mortgage) rates were quite high. My average mortgage rate, give or take, has fallen nearly every single day since that time.

The trend has remained in place through Major, Blair, Brown, Cameron & May. Rates will rise at some point but, in 10 years time, I think threads like this will still be running.

Debt loads for individuals have risen massively though since then? Small increases have much bigger consequences for people now.

buggy_boy

Most banks are and have been for a while now after the crash of 2008 been stress testing people to SVR + 2% which is usually around 7%, interest only mortgages for residential properties are now extremely rare, so I dont see how a small increase in interest rates will have a massive impact, yes people may have to tighten their belts which could effect the economy slightly.

Graham_Devon

buggy_boy wrote: »

Most banks are and have been for a while now after the crash of 2008 been stress testing people to SVR + 2% which is usually around 7%, interest only mortgages for residential properties are now extremely rare, so I dont see how a small increase in interest rates will have a massive impact, yes people may have to tighten their belts which could effect the economy slightly.

That's not the case though. Stress tests only have to take place on certain mortgages, and actually exclude the riskiest low deposit mortgages.

Thrugelmir

ilovehouses wrote: »

A good argument for why rates won't rise much and why the crashaholics are hoping that even rises of a couple of percent will send fearful homeowners into a panic.

Depends on the cost of funding for lenders. QE at least in the US is in reverse. Banks after decades of leveraging up their balance sheets. Are now contracting them. May have benefited a generation. No use to the next though. Different era different situation entirely. .

compHunter

Selfish love for the low interest rates keep my mortgage down. The more I can get paid off before they rise the quicker I can get to "FIRE"

thor

Thrugelmir wrote: »

Depends how much he needs to borrow to fund his plans? US Treasuries now offer 3%. While UK 10 Gilts offer 1.27%. I know which I'd buy first.

A pity that savers can't get any of that US Gilts action.

Thrugelmir

thor wrote: »

A pity that savers can't get any of that US Gilts action.

You'll be exposed to currency fluctuations though.

Electrum

The USA have doubled their interest rates, and its going to carry on going up

The UK has only one direction to go, and its not down

westernpromise

So good you posted it twice.