Martin: My mortgage conversation with the Chancellor and why banks should come to the public's aid

MSE_Petar

In an urgent private meeting on mortgages with Chancellor Jeremy Hunt, and in a separate conversation with Shadow Chancellor Rachel Reeves, MoneySavingExpert.com founder Martin Lewis has today (Wednesday 21 June) stressed the need for proper forbearance measures for struggling mortgage holders, and the need for banks not to ramp up their profit margins.

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'Martin Lewis: My mortgage conversation with the Chancellor and why banks should come to the public's aid'

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lwl

I don't know what to do for the best. We have a mortgage but also a business loan for my husband. The loan doesn't become payable in full until retirement (when capital should pay it) but interest is accruing. But the mortgage is payable monthly. Husband thinks the loan should be paid first as interest rate is higher. But I think the mortgage is higher risk and we should reduce payments on that as soon as possible. Thoughts?

philly2811

Hello I am new to this and hope I am doing this right for comments
So me of a simple mind...If someone gets a mortgage at x % over y years and then the Mortgage rate rises the customer  has to pay the increase cost for this. Questions : Q1. I can imagine most mortgage lenders already have their own cash(non loaned) funds to provide the customer with a money to pay for their home and so do not have to find x % interest rate same as whatever original agreed mortgage rate was and no doubt making a good profit . By the BOE raising interest rates further then make even more profits. If this correct? Q2. If the lenders are then making even more profits due to interest hikes, why cant they use a proportion of this additional profit to support its customers like interest free payment holidays without penalties or other support? I get that the BOE is raising rates to reduce people spending but as ever can see the financial institutes and shareholders becoming even more wealthier while the normal folk again suffer. 

silvercar

lwl said:

I don't know what to do for the best. We have a mortgage but also a business loan for my husband. The loan doesn't become payable in full until retirement (when capital should pay it) but interest is accruing. But the mortgage is payable monthly. Husband thinks the loan should be paid first as interest rate is higher. But I think the mortgage is higher risk and we should reduce payments on that as soon as possible. Thoughts?

Mortgage so your home is safe. Is the business loan secured? Personal guarantee?