Fixed or Variable

CSI_Yorkshire

Andreg said:

CSI_Yorkshire said:

Andreg said:

CSI_Yorkshire said:

Understanding risk involves looking at both the outcome and the chance of each scenario.

Indeed, and this scenario, of being unable to afford the payments, had not been mentioned previously in the thread. I leave it to the OP to decide just how bad losing one's home is and therefore how much weight that should carry in their analysis.

Interesting that you choose to suggest, again, that the OP should decide how bad that situation is without considering how likely it is.

How bad would it be if the next time you stepped outside you were struck on the head by falling space debris?

Interesting that you choose to suggest that interest rates at 10% is as likely as being struck on the head by falling space debris.  That appears to be where we differ.

I didn't.  I made no comment on likelihood, just as you did not.  Notice the problem when you only consider half of the equation?

Neither am I suggesting that interest rates at 10% would cause the OP to lose their home, but you seem to have done that as well.

A good demonstration of why consideration of the whole picture is required otherwise incorrect conclusions can be drawn.  Thanks for that.

Andreg

So I think the conclusion is that no intelligent person, including the Bank of England, respected economists and forumites, can have huge confidence in what the range of possible interest rates might be in future, therefore any risk based analysis should be weighted prudently.