chrisp65 Posted March 23, 2023 Share Posted March 23, 2023 15 minutes ago, Genie said: Surely you decide how long you have left? You could just structure the remaining balance over as many years as you want. Oh absolutely. I can stretch it to the two years or longer. I can overpay, I can top up the loan to do some improvements. I can shop around. The complaint was essentially my current provider thinking they could get away with only offering me the laziest most profitable option for themselves. 2 Link to comment Share on other sites More sharing options...
osmark86 Posted March 23, 2023 Share Posted March 23, 2023 (edited) 1 hour ago, Genie said: If inflation was being driven by clothing, holidays, TVs, phones etc then I could see why interest rates would be the way to go. As it’s being driven by basic food, heat, electricity and petrol I don’t see how it’s going to help much. Inflation will more than likely come down later in the year regardless of interest rates. Maybe next year they’ll be slashing interest rates again to stimulate the economy. I don't believe it really matters too much what is driving inflation in this case. Obviously goods we truly need (like food, heat, electricity...) makes it hit harder on regular Joes putting more pressure on curbing it with the additional kicker that we can't avoid spending money on these goods. But the problem imo is that we've made debt too cheap and available over such a long time that the average household debt is relatively so much higher these days. If anything this has been a driver of house price inflation which is a very expensive commodity and also a basic necessity. This has made us all collectively much more interest rate sensitive, so monetary policy is tougher to pursue regardless of what drives inflation. If they slash interest rates again the cycle will just continue. Housing will still be viewed as investments more than basic necessities and the way to secure wealth over time. At least inflation will eat away at that debt over time I suppose... Couple all of this with what's basically a stand-still in real wages over time and it's a poor cocktail to swallow. Edited March 23, 2023 by osmark86 1 Link to comment Share on other sites More sharing options...
chrisp65 Posted March 23, 2023 Share Posted March 23, 2023 Just now, blandy said: Not half. As a motivator, I made a spreadsheet with a comparison calc of "how much will I pay if I run to the end of the mortgage at the current payment level and interest rate" v each time I overpaid, how much that total reduced by, and it was massive - like (I can't remember the numbers, but...) £275 quid for another 60 months at 5% = x amount total, but £500/mth = a couple of grand less total, plus a couple of years early finish (and therefore another 275 x24 = £6K + in monthly payments no longer needed (or whatever the numbers were) - total saving of 8 grand or so, I think, just for paying 225 extra for a few years. There's probably online things you can work it out on, these days. Even just a little bit of rounding up helps over the long term. Since the start of ours, whatever the required number was, say £92.32 then I’d pay £100. Over 25 years, that’s knocking a couple of months off at the end. 2 Link to comment Share on other sites More sharing options...
sidcow Posted March 23, 2023 VT Supporter Share Posted March 23, 2023 (edited) If we continue on this path it will be back to the 80's and 90's where you can go on holiday to Spain and the beer and food is stupidly cheap Brexit bonus. Edited March 23, 2023 by sidcow 1 Link to comment Share on other sites More sharing options...
Xann Posted March 23, 2023 Share Posted March 23, 2023 Swerving shrinkflated products now. They can stick their 1.7 litres up their arse. It'll be easier for them to get up there too. 2 2 Link to comment Share on other sites More sharing options...
sidcow Posted March 23, 2023 VT Supporter Share Posted March 23, 2023 (edited) 4 hours ago, Xann said: Swerving shrinkflated products now. They can stick their 1.7 litres up their arse. It'll be easier for them to get up there too. I've noticed Greggs sausage rolls shrinking for a while now but I noticed the other day all of their slices in the heater were looking much smaller than they used to be. **** hate shrinkflation. I'd rather they just put the price up. Grab bags of Walkers are now about the size of a normal bag of Walkers from the 80's. I've said before, one day in the future you will open up a tub of Quality Street and a solitary purple one will be sat there. Where does it all end? Edited March 23, 2023 by sidcow 1 Link to comment Share on other sites More sharing options...
StewieGriffin Posted March 23, 2023 Share Posted March 23, 2023 7 hours ago, Genie said: Idiot question regarding this... the 4.5% goes on top of your existing interest rate, yes? So a current fixed term rate of, say, 2.5% would result in 7% if I renewed tomorrow? Link to comment Share on other sites More sharing options...
trekka Posted March 23, 2023 VT Supporter Share Posted March 23, 2023 (edited) 15 minutes ago, sidcow said: I've noticed Greggs sausage rolls shrinking for a while now but I noticed the other day all of their slices in the heater were looking much smaller than they used to be. **** hate shrinkflation. I'd rather they just put the price up. Grab bags of Walkers are now about the size of a normal bag of Walkers from the 80's. I've said before, one day in the future you will open up a tub of Quality Street and a solitary purple one will be sat there. Where does it all end? Ooohhh, so apparently the purple ones contain 3.5% hazelnut. You watch them reduce the size of them and end up with barely any hazelnut in at all. It's absolutely nuts. They rake in the cashews whilst we live on peanuts. Edited March 23, 2023 by trekka 1 Link to comment Share on other sites More sharing options...
Genie Posted March 23, 2023 Share Posted March 23, 2023 (edited) 30 minutes ago, StewieGriffin said: Idiot question regarding this... the 4.5% goes on top of your existing interest rate, yes? So a current fixed term rate of, say, 2.5% would result in 7% if I renewed tomorrow? No, if your mortgage fixed then it doesn’t change. 2.5% stays as 2.5% regardless of what the BoE do. I’m on a fixed rate until 2026 so even if the BoE put interest rates up to 20% my mortgage will stay the same (until 2026). People on variable rate mortgages will see their mortgages go up as they will track what the BoE does. Same for tracker mortgages (tracker could be something like BoE base rate +2% for example). Fixed is fixed. Edited March 23, 2023 by Genie Link to comment Share on other sites More sharing options...
StewieGriffin Posted March 23, 2023 Share Posted March 23, 2023 20 minutes ago, Genie said: No, if your mortgage fixed then it doesn’t change. 2.5% stays as 2.5% regardless of what the BoE do. I’m on a fixed rate until 2026 so even if the BoE put interest rates up to 20% my mortgage will stay the same (until 2026). People on variable rate mortgages will see their mortgages go up as they will track what the BoE does. Same for tracker mortgages (tracker could be something like BoE base rate +2% for example). Fixed is fixed. I get that, I probably should have made my question (much) clearer.... How does the base rate affect what interest rate my lender what would offer me when I come to renew my fixed term? In essence, if I'm filling in a "how much will my mortgage potentially go up by" calculator, do I put 4.5% in the "what will my interest rate be?" Link to comment Share on other sites More sharing options...
Genie Posted March 23, 2023 Share Posted March 23, 2023 (edited) 8 minutes ago, StewieGriffin said: I get that, I probably should have made my question (much) clearer.... How does the base rate affect what interest rate my lender what would offer me when I come to renew my fixed term? In essence, if I'm filling in a "how much will my mortgage potentially go up by" calculator, do I put 4.5% in the "what will my interest rate be?" Best thing to do is punch in the numbers into one of the comparison tools and see what comes up based on now. I just stuck some generic numbers into moneysupermarket, £200k loan on a £250k value house. You can get a 5 year fix about 4.1% which is quite close to the actual BoE base rate. What that tells me is that the lender thinks it’s going to go down in the future so they want to tempt you in by fixing for 5 years. Edit: On my situation I could get a 10 year fix at 3.99%. Edited March 23, 2023 by Genie Link to comment Share on other sites More sharing options...
Loxstock92 Posted March 23, 2023 Share Posted March 23, 2023 2 minutes ago, StewieGriffin said: I get that, I probably should have made my question (much) clearer.... How does the base rate affect what interest rate my lender what would offer me when I come to renew my fixed term? In essence, if I'm filling in a "how much will my mortgage potentially go up by" calculator, do I put 4.5% in the "what will my interest rate be?" you could put it down as a best case scenario, mortgage lenders price their mortgages based on whether they want to have best buy products to increase lending for a period of time possibly due to an influx of deposits, how their competitors are pricing their mortgages. if you’re rate is due to finish soon, check out what your lender is currently offering as of now, if not a comparison site will give you a general overview of the state of things at the moment. Link to comment Share on other sites More sharing options...
cheltenham_villa Posted March 23, 2023 Share Posted March 23, 2023 16 minutes ago, StewieGriffin said: I get that, I probably should have made my question (much) clearer.... How does the base rate affect what interest rate my lender what would offer me when I come to renew my fixed term? In essence, if I'm filling in a "how much will my mortgage potentially go up by" calculator, do I put 4.5% in the "what will my interest rate be?" The base rate is the bit that banks have to pay to borrow money from each other. So usually a mortgage rate is the base rate plus a bit extra to generate some margin for a bank. That extra can be quite small if the markets are performing and the risk of you paying your mortgage back is low. When the opposite happens, banks add more on top of the base rate. This rate wasn't a huge surprised so the banks have likely baked it in already. Depending on your circumstances expect to pay between about 5.5 and 7 percent. Link to comment Share on other sites More sharing options...
Genie Posted March 23, 2023 Share Posted March 23, 2023 12 minutes ago, cheltenham_villa said: The base rate is the bit that banks have to pay to borrow money from each other. So usually a mortgage rate is the base rate plus a bit extra to generate some margin for a bank. That extra can be quite small if the markets are performing and the risk of you paying your mortgage back is low. When the opposite happens, banks add more on top of the base rate. This rate wasn't a huge surprised so the banks have likely baked it in already. Depending on your circumstances expect to pay between about 5.5 and 7 percent. Strangely the fixed deals I looked at were around the 4% mark, which suggests the backs are expecting the rate to drop after they’ve locked you in. Obviously it’ll also depend on how much equity you have. If borrowing 60% of the total value or less then you’d qualify for the best rates. Link to comment Share on other sites More sharing options...
StewieGriffin Posted March 23, 2023 Share Posted March 23, 2023 Thanks for the replies Our LTV is around 60% I'd say - we've got about 90k to pay with about 26 years left, but the house value is uncertain. I'd guess around 160k, but we've had a conservatory and porch built which will add a bit - a couple of end terrace houses here have gone for 190k in the last few months, but we're mid-terrace. We aren't due to renew for another 5 months or so, so hopefully it's calmed down a little by then... Link to comment Share on other sites More sharing options...
Demitri_C Posted March 24, 2023 Share Posted March 24, 2023 4 hours ago, Genie said: No, if your mortgage fixed then it doesn’t change. 2.5% stays as 2.5% regardless of what the BoE do. I’m on a fixed rate until 2026 so even if the BoE put interest rates up to 20% my mortgage will stay the same (until 2026). People on variable rate mortgages will see their mortgages go up as they will track what the BoE does. Same for tracker mortgages (tracker could be something like BoE base rate +2% for example). Fixed is fixed. I fixed mine for5 years so i have another 3 years left as i did mine 2 years ago when prices were rock bottom. If you didnt fix it back then (im talking generally not at you genie) then its abit silly of you to have not fixed it back then as prices were rock bottom even if they dropped more the amount you would have saved was miniscule Thats a fatal error by the individual Link to comment Share on other sites More sharing options...
Genie Posted March 24, 2023 Share Posted March 24, 2023 6 hours ago, Demitri_C said: I fixed mine for5 years so i have another 3 years left as i did mine 2 years ago when prices were rock bottom. If you didnt fix it back then (im talking generally not at you genie) then its abit silly of you to have not fixed it back then as prices were rock bottom even if they dropped more the amount you would have saved was miniscule Thats a fatal error by the individual You can only fix it when it’s due, people might have fixed 5 years ago (also rock bottom) but now needing to get the best deal they can. Link to comment Share on other sites More sharing options...
tinker Posted March 24, 2023 VT Supporter Share Posted March 24, 2023 17 minutes ago, Genie said: You can only fix it when it’s due, people might have fixed 5 years ago (also rock bottom) but now needing to get the best deal they can. You can get a mortgage deal 6 months before your current one is due to expire, it's locked in but you can always go elsewhere within the 6 months if better deals come along. I used an offset mortgage for my last 6 years mortgage , any savings I had in the offset account, or overpayment, offset the interest rate. Another useful tool is interest free credit cards, live using the balance you have on them and pay you wages into the offset account. 2 Link to comment Share on other sites More sharing options...
Genie Posted March 24, 2023 Share Posted March 24, 2023 17 minutes ago, tinker said: You can get a mortgage deal 6 months before your current one is due to expire, it's locked in but you can always go elsewhere within the 6 months if better deals come along. I used an offset mortgage for my last 6 years mortgage , any savings I had in the offset account, or overpayment, offset the interest rate. Another useful tool is interest free credit cards, live using the balance you have on them and pay you wages into the offset account. Good tips! I still have to Feb 26 before mine expires. I could be wrong but current fixed deals below BoE rate make me think the lenders believe the rates will come down again. Link to comment Share on other sites More sharing options...
tinker Posted March 24, 2023 VT Supporter Share Posted March 24, 2023 1 hour ago, Genie said: Good tips! I still have to Feb 26 before mine expires. I could be wrong but current fixed deals below BoE rate make me think the lenders believe the rates will come down again. Hopefully inflation drops and then interests rates will but definitely fix in a deal as soon as you can, that way if any fresh disaster strikes your locked in at that rate. Unfortunately I'm old enough to remember interests rates of double figures........horrendous time , but house prices did drop so not bad for everyone. 1 Link to comment Share on other sites More sharing options...
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