tip, if you find a good deal go for it!

Dan_Collins_2

Just a tip, we are finding that clients are dithering and hoping rates will go down or something better will come along. Rates seem to be creeping up across the board and it you find a good deal, then go for it or you could miss out!!

maveli

100 % with you on this.

HSBC's Life tracker and many of First direct deals are example. Also see this news on BBC <<http://news.bbc.co.uk/1/hi/business/7300430.stm>>

homer_j_3

But if you get declined, do not carry on being credit checked. Get a copy of your credit file and seek professional advice if uncertain where to go..

stoke_bishop

Dan_Collins wrote: »

Just a tip, we are finding that clients are dithering and hoping rates will go down or something better will come along. Rates seem to be creeping up across the board and it you find a good deal, then go for it or you could miss out!!

Does a +0.5% tracker, which I'm on now for the term constitute a good deal, or should I be safe and get a fixed?
I am 75% LTV (250/335) and have a joint salary of 75Kish.
I'm tempted to go for a 5.19/5.29 ish 5 year fixed.
I don't want the stress if the base rate with the global crisis goes to 8-10% over the next few years. I know everyone is saying relax it will go down if anything. But surely it going up is just round the corner if the economy is going "tits up"???

gil13

I definately agree the uncertainty at the moment is creating it's own problems and nobody is really sure where this credit crisis is going to end up. I just have a sneaky feeling that some of the fix rates will by the end of the year be priced a bit lower, in the meantime the banks are quite rightly being cautious and rebuilding their margins when the opportunity allows. I expect 0.75% basis points either side of where we are today over the next couple of years, if the economy goes "tits-up" as you put it would expect the BOE to cut more aggressively despite the inflation risk.

Dan_Collins_2

gil13 wrote: »

I definately agree the uncertainty at the moment is creating it's own problems and nobody is really sure where this credit crisis is going to end up. I just have a sneaky feeling that some of the fix rates will by the end of the year be priced a bit lower, in the meantime the banks are quite rightly being cautious and rebuilding their margins when the opportunity allows. I expect 0.75% basis points either side of where we are today over the next couple of years, if the economy goes "tits-up" as you put it would expect the BOE to cut more aggressively despite the inflation risk.

Fixed rates will not be lower than they are now this year, I would bet my last dollor! Although it may not be worth much.

The BOE rate may not have any influence on lenders fixed rates. LIBOR will, and with banks not lending to each other and a lack of funds, lenders will lend less but will not want to earn less!!

gil13

Hi Dan, yeah it's a difficult one to call I am only guessing, just keeping an eye on swap rates to see if that shows any trends developing, but it is so volatile; 10 year swap rate showing 4.98% from 5.04% last week alone. You may be right that shorter fixes are not going to do much, I think when my deal eventually ends I will be going for a 5 or 10 year fix. I have decided there is a lot to be said for that certainty, even though it might have a cost.

Dan_Collins_2

Good point gil, comes to a point when trying to beat the BOE gets a bit risky in times like this. If we had crystal balls I would be typing this from beside my pool! Long term fixes are offering good value for money at the mo.

Stoke Bishop, if you are worried about rates then a tracker is no good for you. What the point of trying to beat rates and then not sleep at night in case rates go up!

stoke_bishop

Dan_Collins wrote: »

Good point gil, comes to a point when trying to beat the BOE gets a bit risky in times like this. If we had crystal balls I would be typing this from beside my pool! Long term fixes are offering good value for money at the mo.

Stoke Bishop, if you are worried about rates then a tracker is no good for you. What the point of trying to beat rates and then not sleep at night in case rates go up!

I'm inclined to agree with you Dan. (and all) Thanks for the help!

UK007BullDog

My mind is boggling, Rates and products being pulled left, right and center.

I think rates will go up the way things are going. even with inflation at 2.5% and people expecting a cut in interest rates next month, I don't think it will make any difference as there is no money in the system.

I think some of the banks are flat broke and that is why they are pulling products, not because they are inundated with people taking their mortgages.

EdInvestor

UK007BullDog wrote: »

I think some of the banks are flat broke and that is why they are pulling products, not because they are inundated with people taking their mortgages.

No that's not it. The problem is more complicated: the banks are all hoarding cash rather than lending it long term, because they are worried they won't be able to replace the money they've got if they lend it out. This is because the money markets for shorter term lending have seized up. The seizing up is caused by banks being afraid that other banks they lend to might fail.

It is all fear and rumour based.If you look at Bear Stearns, one day it was fine, two days later after some rumours, all its customers fronted up and demanded their money back.No bank can cope with that no matter how strong it is.This is why the central banks are having to supply all this money to the system, so the banks can go and get funds directly rather than from other banks.

The words "self fulfilling prophecy" come to mind. :rolleyes: