These were the days!

jaceyboy

 Huge interest rates....

cloud_dog

Is it 'These' or should it be 'Those'?

  

mebu60

Without knowing the capital the rate could be anything! 

The interest alone would be a large chunk of the FSCS amount, something like £2k at 100% then £33k at 90% around that time if memory serves.

eskbanker

jaceyboy said:

Huge interest rats

As above, that extract says nothing about rates (or rats!), so isn't particularly informative, but it's interesting (no pun intended) to see the lack of taxation, I was under the impression that interest was taxed at source at the time - what sort of account was it?

jaceyboy

eskbanker said:

jaceyboy said:

Huge interest rats

As above, that extract says nothing about rates (or rats!), so isn't particularly informative, but it's interesting (no pun intended) to see the lack of taxation, I was under the impression that interest was taxed at source at the time - what sort of account was it?

Was paid under a SA thats all, was our house money in an account ready to buy....around £300k from memory

eskbanker

jaceyboy said:

eskbanker said:

jaceyboy said:

Huge interest rats

As above, that extract says nothing about rates (or rats!), so isn't particularly informative, but it's interesting (no pun intended) to see the lack of taxation, I was under the impression that interest was taxed at source at the time - what sort of account was it?

Was paid under a SA thats all, was our house money in an account ready to buy....around £300k from memory

If the interest rate was therefore just over 7%, 'those days' have been happening again in recent times too, with the NS&I 6.2% account whose maturity is being discussed on various other threads, plus regular savers (for smaller amounts) in 7-10% territory!

wmb194

2007 was the beginning of the financial crisis so when the banks and BSs were scrambling for financing you could find 6% to 7% without too much effort. I definitely don't want to go back to those days, though.

"13/09/2007: Stroud & Swindon building society is today launching a savings bond fixed at 7.05% until December next year.

More than 20 providers have increased their savings rates in the past fortnight, even though the Bank of England left the base rate unchanged at 5.75% last week.

This surge of activity has in part been due to institutions trying to pull in extra funds from savers rather than having to borrow on wholesale money markets. The rates at which banks lend money to each other have been rising sharply in the face of continued turmoil in global credit markets."

https://www.theguardian.com/business/2007/sep/13/money

Edit: Stroud & Swindon was one of the BS' rescued by Coventry BS.

https://en.wikipedia.org/wiki/Stroud_%26_Swindon_Building_Society

Stubod

..I remember queuing for the Halifax regular saver at 10.5%....although I would prefer to have lower interest rates with even lower inflation...

slinger2

..I remember my first mortgage (1980): 15%. Borrowed 2.25 times my salary, which meant that the mortgage interest was a third of my gross pay. Mind you, we did get tax relief on mortgage interest payments in those days. Basic rate of income tax 30%.

Brie

Long ago (late 1950s) and far away my parents borrowed $18k at 6% for a house built to order on a 1/4 acre lot in a new subdivision.  Mom said she thought they'd be broke forever.  It's all relative!

Fast forward about 35 years and I had a student loan for attending uni, also about $18k but the interest rate was 18%.  I was making about $400 a month and expected to pay about $450 a month on the loan.  Fortunately my parents hadn't gone broke and they paid it off for me.  

boingy

slinger2 said:

..I remember my first mortgage (1980): 15%. Borrowed 2.25 times my salary, which meant that the mortgage interest was a third of my gross pay. Mind you, we did get tax relief on mortgage interest payments in those days. Basic rate of income tax 30%.

We were not far into our first mortgage when Black Wednesday hit in 1992. Interest rates went from 10% to 12% to 15% in one day. We had a fixed rate but if rates had stayed that high we'd have lost the house when our fixed rate ended the following year. There were people in my office in tears. Then the next day the UK were out of the ERM and rates were 10% again. The early years of a first mortgage are always a high risk and high stress time. What's scary is that we only borrowed about two thirds of the "limit" that our salaries were deemed to be capable of supporting. If we'd borrowed the full amount we'd have starved but had a posher house!