How are people actually coping with mortgage payments increasing?

TheGame21

Our 5 year fix expires in January. We had a mortgage product lined up 3 months ago however for one reason or another we were unable to complete the application and then it was pulled when the Government announced their budget. That would have pushed our monthly payments up around £250. The best 5 year fix we have been offered now, pushes our payments up £550 a month. We have a mortgage of £295k remaining. I am so angry at the Government and what they have done. This is a direct cause of their actions. It's disgraceful. We have 2 young kids so will need to cut back to bare minimums to survive. 

MovingForwards

I'll keep making overpayments and saving, see where things are at closer to the time my fixed rate is up; got 2.5 years left.

Cheesy77

TheGame21 said:

Our 5 year fix expires in January. We had a mortgage product lined up 3 months ago however for one reason or another we were unable to complete the application and then it was pulled when the Government announced their budget. That would have pushed our monthly payments up around £250. The best 5 year fix we have been offered now, pushes our payments up £550 a month. We have a mortgage of £295k remaining. I am so angry at the Government and what they have done. This is a direct cause of their actions. It's disgraceful. We have 2 young kids so will need to cut back to bare minimums to survive. 

Sorry to hear this. I hope you find a way to manage this period. 

It's pretty scandalous that a tiny proportion of the population can select a new PM, and one who then completely changes the economic policy with no mandate. 

Interest rates were on the rise but they've made it all happen much quicker by spooking the markets. 
 

sancahojo

Our fixed rate mortgage of 1.66% is ending in December 25. Our mortgage repayment is £2.2k a month, so you can only imagine what that would jump to on current rates. We have already started overpaying our mortgage in the attempt to get our LTV down to 60% by the time we need to remortgage so that we can hopefully get the best rate possible.

RelievedSheff

I'm genuinely surprised at how large some of the monthly increases in payments some people are claiming they will have.

simon_or

Why? Plenty of people coming off a fix who were probably paying something between 1-2% are now looking at rates between 5-6%.

For a 200k mortgage over 35 years, that takes your monthly payment from £565-663 to £1,009-1,140.

20vt-rs

I have a fix @ 1.94% that ends end of May 2023, the lenders current SVR is 5.04%. This jump has a massive impact on people who have hundreds of thousands remaining, especially if you were stretched at the previously low rates.
I would be looking at re-mortgaging and extending the term as much as possible, as well as tightening the belts in other spend areas, however this sounds simple, it is not always straight forward or easy. 

RelievedSheff

simon_or said:

Why? Plenty of people coming off a fix who were probably paying something between 1-2% are now looking at rates between 5-6%.

For a 200k mortgage over 35 years, that takes your monthly payment from £565-663 to £1,009-1,140.

Running our own figures for when we come around to remortgage if we use todays figures our repayment would at worst increase by £200.

(£129,000 remaining balance over 10 years)

Not a massive increase and certainly one that wouldn't be cause for concern.

simon_or

RelievedSheff said:

simon_or said:

Why? Plenty of people coming off a fix who were probably paying something between 1-2% are now looking at rates between 5-6%.

For a 200k mortgage over 35 years, that takes your monthly payment from £565-663 to £1,009-1,140.

Running our own figures for when we come around to remortgage if we use todays figures our repayment would at worst increase by £200.

(£129,000 remaining balance over 10 years)

Not a massive increase and certainly one that wouldn't be cause for concern.

Those are your numbers, it's hardly going to be the exact same for others is it?

There'll be people who borrowed half/double/triple that and/or terms that are double/triple that and/or interest rates that are different to your's.

So you could have a £200 jump while others have a £50, £500 or a £1,000 jump. These could all be true depending on their individual numbers.

As for the numbers, it's just math, you can use any internet mortgage calculator to game different scenarios.

sancahojo

RelievedSheff said:

simon_or said:

Why? Plenty of people coming off a fix who were probably paying something between 1-2% are now looking at rates between 5-6%.

For a 200k mortgage over 35 years, that takes your monthly payment from £565-663 to £1,009-1,140.

Running our own figures for when we come around to remortgage if we use todays figures our repayment would at worst increase by £200.

(£129,000 remaining balance over 10 years)

Not a massive increase and certainly one that wouldn't be cause for concern.

My remaining balance is £582k, so take your £200 and x5