Fears grow of a spike in mortgage rates as the Government battles to curb rising inflation

MSE_Emily

Mortgage rates could hit "well over 6% or 7%" one broker told MoneySavingExpert.com after new forecasts from the Office for Budget Responsibility (OBR) show the Bank of England's base rate could rise to 3.5%. This could mean an end to record low mortgages rates, so it's worth checking now if you can lock-in to save £1,000s...

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Fears grow of a spike in mortgage rates as the Government battles to curb rising inflation

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ACG

Thats a catchy sound bite, but it sounds like it has been said for the shock factor. I cant see the average person paying 6-7% any time soon, I would be surprised if they pay that before the end of the decade. The country would go to pot as a lot of people would not be able to afford their mortgage. 

There are some lenders who charge 6-7% now, but those are for people with VERY bad credit, so it is not unheard of but it is also only a very small number of people - maybe 1-2% of mortgages. 

YBR

My mother would say 6-7% is nothing, being the generation that paid up to 18%, I feel that was somewhat etched into her memory!

SpiderLegs

Top clickbait MSE.

sevenhills

ACG said:

The country would go to pot as a lot of people would not be able to afford their mortgage. 
There are some lenders who charge 6-7% now, but those are for people with VERY bad credit, so it is not unheard of but it is also only a very small number of people - maybe 1-2% of mortgages. 

Surely a good percentage of borrowers have at least a 2 year fix, so the pain would be felt very slowly.

ACG

Half of those will be out of their 2 year deal within 12 months....
But it is not just your mortgage is it. You might be able to stretch to the extra repayments, but what about your gas bills, council tax, food, fuel etc etc. It soon adds up. 

How many people have stretched themselves when buying their new home in the last 12-18 months because of the stamp duty holiday? 

kaMelo

ACG said:

Half of those will be out of their 2 year deal within 12 months....
But it is not just your mortgage is it. You might be able to stretch to the extra repayments, but what about your gas bills, council tax, food, fuel etc etc. It soon adds up. 

How many people have stretched themselves when buying their new home in the last 12-18 months because of the stamp duty holiday? 

That may be true but anyone who did so would have to be incredibly naïve to believe that record low interest rates would stay at record lows or had any other direction to go but upwards. 

strawb_shortcake

ACG said:

Half of those will be out of their 2 year deal within 12 months....
But it is not just your mortgage is it. You might be able to stretch to the extra repayments, but what about your gas bills, council tax, food, fuel etc etc. It soon adds up. 

How many people have stretched themselves when buying their new home in the last 12-18 months because of the stamp duty holiday? 

ACG said:

Half of those will be out of their 2 year deal within 12 months....
But it is not just your mortgage is it. You might be able to stretch to the extra repayments, but what about your gas bills, council tax, food, fuel etc etc. It soon adds up. 

How many people have stretched themselves when buying their new home in the last 12-18 months because of the stamp duty holiday? 

Shouldn't the stress testing that mortgage brokers undertake mean that any rises remain affordable even if it is tighter? 

Thrugelmir

MSE_Emily said:

Mortgage rates could hit "well over 6% or 7%" one broker told MoneySavingExpert.com after new forecasts from the Office for Budget Responsibility (OBR) show the Bank of England's base rate could rise to 3.5%

More of a Daily Mirror headline than one you'd expect on a credible financial website. Totally out of context and misleading.

0/10 for journalism. 

london21

People are been scared into making quick irrational decision.
Interest rates will go up gradually.

london21

ACG said:

Half of those will be out of their 2 year deal within 12 months....
But it is not just your mortgage is it. You might be able to stretch to the extra repayments, but what about your gas bills, council tax, food, fuel etc etc. It soon adds up. 

How many people have stretched themselves when buying their new home in the last 12-18 months because of the stamp duty holiday? 

The stamp duty holiday has really favored the sellers, I do not understand saving £15k stamp duty but house price up £30k

the next few months will be interesting. think the market will slow down a bit.