Do you think interest rates are going to fall significantly (<2%) over the next 5 years?

ReadySteadyPop

kingstreet said:

Are you talking about base rate below 2%, or mortgage rates below 2%? I'd say the latter is highly unlikely.

I would say both are extremely unlikely, the cheap debt experiment only worked with a globalised world economy, we are now returning to nations looking out for their own interests first, rates will revert to historical norms in my opinion.

ReadySteadyPop

ACG said:

The options are below 2% and above 3%... what about everything in between? 
And are we talking base rates or mortgage rates? 

I am doing a mortgage for a customer on monday, 2.89%... But it comes with a fee that makes the mortgage the same as over 4%. 

That`s a bit naughty isn`t it?

MeteredOut

No, I think interest rates will remain above 3% for the next 5 years

El_Torro said:

born_again said:

I guess it all depends on just what happens in the budget & how inflation go's after that. 

While the UK government (regardless of which party is in power) has an influence I would be more concerned about global factors affecting inflation than an annual Budget. The next Covid, or Ukraine, or unrest in the Middle East, will have a much bigger impact.

If I were to hazard a guess (and it really is just a guess) I would say that it will be a long time before we see interest rates below 2% again, more than 5 years from now.

I'm going to be remortgaging myself in early 2025. While I'll compare 2 year rates and 5 year rates my feeling is that I'll probably go with a 5 year fixed rate.

Is that not illegal nowadays?

ACG

ReadySteadyPop said:

ACG said:

The options are below 2% and above 3%... what about everything in between? 
And are we talking base rates or mortgage rates? 

I am doing a mortgage for a customer on monday, 2.89%... But it comes with a fee that makes the mortgage the same as over 4%. 

That`s a bit naughty isn`t it?

I dont think so. 
The customer knows about it, I explained it would have been cheaper for her to choose a higher rate with a lower fee. 

This product gave her more choice. It certainly wont be for everyone and it was not my initial recommendation. But as a single mum her priority was lower repayments even if it costs a little more in the long run. 

In the last 5 years we have gone from average rates of under 2.5% to almost double that. Not everyone is in a position to deal with the higher rates. Some of the conversations we were having after the mini budget were awful, I really did not like picking up the phone in 2022 as it always felt like bad news. 

I would much rather have these options available for people to turn down than not have them. 

RelievedSheff

No, I think interest rates will remain above 3% for the next 5 years

MeteredOut said:

El_Torro said:

born_again said:

I guess it all depends on just what happens in the budget & how inflation go's after that. 

While the UK government (regardless of which party is in power) has an influence I would be more concerned about global factors affecting inflation than an annual Budget. The next Covid, or Ukraine, or unrest in the Middle East, will have a much bigger impact.

If I were to hazard a guess (and it really is just a guess) I would say that it will be a long time before we see interest rates below 2% again, more than 5 years from now.

I'm going to be remortgaging myself in early 2025. While I'll compare 2 year rates and 5 year rates my feeling is that I'll probably go with a 5 year fixed rate.

Is that not illegal nowadays?

No.

Why would it be?

ReadySteadyPop

ACG said:

ReadySteadyPop said:

ACG said:

The options are below 2% and above 3%... what about everything in between? 
And are we talking base rates or mortgage rates? 

I am doing a mortgage for a customer on monday, 2.89%... But it comes with a fee that makes the mortgage the same as over 4%. 

That`s a bit naughty isn`t it?

I dont think so. 
The customer knows about it, I explained it would have been cheaper for her to choose a higher rate with a lower fee. 

This product gave her more choice. It certainly wont be for everyone and it was not my initial recommendation. But as a single mum her priority was lower repayments even if it costs a little more in the long run. 

In the last 5 years we have gone from average rates of under 2.5% to almost double that. Not everyone is in a position to deal with the higher rates. Some of the conversations we were having after the mini budget were awful, I really did not like picking up the phone in 2022 as it always felt like bad news. 

I would much rather have these options available for people to turn down than not have them. 

Yields are higher now than during the mini budget?

Yorkie1

RelievedSheff said:

MeteredOut said:

I'm going to be remortgaging myself in early 2025. 

Is that not illegal nowadays?

No.

Why would it be?

I suspect it was a joke about (re)mortgaging one's personal body, rather than doing an act of remortgaging one's house.