chuffed, just fixed my mortgage for 5 years @3.99%
Discussion
Kermit power said:
Is that a good deal? 
Ours is on base rate +1.34%, so we're currently paying 1.84%. No doubt rates are likely to go up rather than down over the next 5 years, but I can't see them going up that far that quickly, surely?
You may note think so at this moment in time, but if the base rate goes up to 2.5% you will be paying roughly the same, once the base rate goes up 1% common sense says that mortgage providers will pull products as there will be a mad scramble,my crystal ball thinks 6-8% after the Election, Someone has to pay..it may be you, but definatley not me..sleep well, (I will for 5 years). Ours is on base rate +1.34%, so we're currently paying 1.84%. No doubt rates are likely to go up rather than down over the next 5 years, but I can't see them going up that far that quickly, surely?
Kermit power said:
Is that a good deal?
Ours is on base rate +1.34%, so we're currently paying 1.84%. No doubt rates are likely to go up rather than down over the next 5 years, but I can't see them going up that far that quickly, surely?
Bank of England remit from the government is to try to target CPI at around 2.00% They have used the interest rates to try to achieve this. Last month the CPI increased from 3.00% to 3.20%. We are a net importer as a nation, and with the relative 30% drop in the value of sterling, in theory, importers would need to drop prices by 30% to maintain prices - this in the longer term is unrealistic, so we will continue to see general increases in prices that contribute to the CPI. 'IF' the Bank of England remains independent from the politics, still having to work to their 2.00% CPI target, then rates will have to go up, and may have to go up sharply - hence, many are keen to secure themselves on fixed rate mortgages (like myself), particularly those that remember rate increases through August 1989. Ours is on base rate +1.34%, so we're currently paying 1.84%. No doubt rates are likely to go up rather than down over the next 5 years, but I can't see them going up that far that quickly, surely?
Just my view as a layperson - I am by no means an expert on the subject.
Fittster said:
So then you don't think we are following Japan then? They have had very low interest rates for decades after their boom went bust.
That's one of the things I've been wondering. I've been trying to find a website that shows the central bank borrowing rates over time for various major economies, but I've not been able to find one. There can't be all that many examples of developed economies dropping their base rates to effectively zero, but it would be interesting to see whether or not Japan is atypical once they do.The differences for us is the mandate of the Bank of England and its so called 'independence' and whether that and the mandate, remains. Then there is the currency valuation - and whether it continues to fall and the likely inflation that follows given our lack of production. Another difference is Japan produced a lot more, and I believe is a net exporter so could maintain price levels with a low interest rate, which I don't think the UK can. An upside, if this situation does develop in the way Japan did, is a return to UK production. With increased import prices, low interest rates (and if liquidity returns to business lending), and greater abundance of empty commercial property at lower rents, I can see an important return/significant strengthening of a British Manufacturing sector. Something the UK economy really does need.
Tiggsy said:
Kermit power said:
Is that a good deal?
Ours is on base rate +1.34%, so we're currently paying 1.84%.
ask that again when the base is at 8%!Ours is on base rate +1.34%, so we're currently paying 1.84%.
3.99 is superb at 5 years....the second we get a rise the lenders will start offering 6/7 % fixes.
Kermit power said:
Tiggsy said:
Kermit power said:
Is that a good deal?
Ours is on base rate +1.34%, so we're currently paying 1.84%.
ask that again when the base is at 8%!Ours is on base rate +1.34%, so we're currently paying 1.84%.
3.99 is superb at 5 years....the second we get a rise the lenders will start offering 6/7 % fixes.
Sensible choice if the rates do rocket.
I went for a flexible mortgage May last year currently on a Tracker at 1%, any sniff the rates going up I will switch to a fixed. I personally have saved over 2K excluding any over payments to date, another 6 months another 3K, long may it continue but I doubt these low rates will last much longer than a year.
I went for a flexible mortgage May last year currently on a Tracker at 1%, any sniff the rates going up I will switch to a fixed. I personally have saved over 2K excluding any over payments to date, another 6 months another 3K, long may it continue but I doubt these low rates will last much longer than a year.
Edited by VTECMatt on Saturday 28th March 21:09
Gassing Station | Homes, Gardens and DIY | Top of Page | What's New | My Stuff