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

getmore4less

j.a.mcguire said:

After climbing from < 1% two weeks ago to 1.14%, the HSBC 5 year fixed has dropped by 0.1% in the past 48 hours to 1.04%.

So if the orginal article mentioned here is correct, why the fall in interest rates?  Anyone with boots on the ground got a better impression of the state of things to come?

This issue for a lender putting up rates while some lenders hold back is the business shifts to the ones that wait.

When it became fairly clear that things were not as bad as they could have been there was a race to the bottom that's why we have rates under 1% at the low end of LTV which were never that risky so the drops have been relatively small but competition has driven them down even though the changes have been tiny at times

Even the real risky stuff at high LTV have recovered they have had the real big swings.

look at  2y fix with fee  60% 80% 90% with Natwest at three data point now, Jan 2020 July 2020
60%----80%----90%
0.98% 1.44% 1.87%
1.25% 2.03% 3.44%
1.17% 1.41%  N/A(withdrawn)

fewcloudy

kaMelo said:

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. 

@kaMelo

I would be giving Jeff Bezos a run for his money if I had a pound for every time I've read on here how "interest rates are only going one way"

Started about 13 years ago in 2008 and has not stopped since.

*However, I do realise that one day they will be able to say "See, I was right".

fewcloudy

socks_uk said:

In 2008 we took out a 10 year fix at 5.4%. We had looked at historical percentage rates and took a gamble on the rates going up or down for the knowledge that we knew for 10 years we'd be paying the same amount.
In 2018 we fixed again for another 10 years but at 2.79% but we carried on paying the same monthly payments which means we are overpaying our mortgage by £100 each month. Yes, in hindsight we could have saved quite a bit in interest on the first 10-year fixed rate but the peace of mind was worth so much more to us!
We still have 7 years left on the fixed rate and we still have about £37,000 (plus the interest) but with us overpaying each month we'll have paid it off before then and our little bungalow will be all ours. We did the right thing for our own peace of mind and don't regret it.

@socks_uk

Define "quite a bit in interest" please It could not possible be worth spending that much for peace of mind.

getmore4less

fewcloudy said:

kaMelo said:

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. 

I would be giving Jeff Bezos a run for his money if I had a pound for every time I've read on here how "interest rates are only going one way"

Started about 13 years ago in 2008 and has not stopped since...

*I realise that one day they will be able to say "I was right", lol!

Even before the 2008 melt down the mantra was fix before rates go up, they  just happened to be right a little more often but it rarely saved much money if any for most people.

that was in the days when the swings were far more regular than they have been for the last13 years