Mortgage rates / interest etc

[ian33a]

I do wish Kev would stop trying to ask questions about mortgages. This is a thread about immigration and politics

 

[Chris70]

omg, I love this forum with all its seriousness and humour. You've got to laugh, else you'd cry.

I once heard about a meritocracy as an alternative to a democracy. I wonder, has any country every tried such a goverment? Checking its definition on the web returned "Britain is a meritocracy, and everyone with skill and imagination may aspire to reach the highest level". Well, it's not evident where comedians like Bozo, Liz Lettuce, the MP for the 18th century and Matt Hancock abound.

My friend Wikipedia says "Occasionally circumstances arise where normally opposing parties may find it desirable to form a government. One is a national crisis such as a war or depression, where people feel a need for national unity and stability that overcomes ordinary ideological differences"

Perhaps, as the current malaise deteriorates further, a coalition will come to pass. I certainly hope so. And while we're pondering all this, the planet burns, omg

 

[IBmatty]

omg, I love this forum with all its seriousness and humour. You've got to laugh, else you'd cry.

I once heard about a meritocracy as an alternative to a democracy. I wonder, has any country every tried such a goverment? Checking its definition on the web returned "Britain is a meritocracy, and everyone with skill and imagination may aspire to reach the highest level". Well, it's not evident where comedians like Bozo, Liz Lettuce, the MP for the 18th century and Matt Hancock abound.

My friend Wikipedia says "Occasionally circumstances arise where normally opposing parties may find it desirable to form a government. One is a national crisis such as a war or depression, where people feel a need for national unity and stability that overcomes ordinary ideological differences"

Perhaps, as the current malaise deteriorates further, a coalition will come to pass. I certainly hope so. And while we're pondering all this, the planet burns, omg

All you need to know about democracy:

 

[Scruples]

We have left the EU.

And that is relevant because?

 

[Jameshow]

You'll never please everyone.
What we really need is to dump the politicians and find a new system to 'govern' the uk.
A lot of the time they dont explain their actions, presumably because we are all too dumb to understand?, but we all see through the lies, whether its tory, labour etc. They are no better than estate agents.

So i need to decide 2 year or 5 year fix. 2 year is currently higher interest, but if somehow the rates come down after next years hardship, i dont want to be paying higher interest for another 3 years. Conversely, 5 year might work out cheaper if the rates stay up for 3 or 4 years

Or i could sell the house, buy a field and wear a grass skirt for a while, shower when it rains, forage the land and turn into swampy ( without the hair ) but im not sure the mrs and kids will quite cope with that

If you can afford it I'd fix for 5 years I cannot see rates coming down much if at all.

With inflation at 10% your payments are 10% less each year anyhow.

 

[baldkev]

If you can afford it I'd fix for 5 years I cannot see rates coming down much if at all.

With inflation at 10% your payments are 10% less each year anyhow.

Im not sure i get the inflation comment my wages havent inflated, although being self employed i could try it on the next quote

 

[Keith Cocker]

Hello Terry, whilst I too hate waste, I think your rather off hand comment about a deep recession hitting "some people" quite hard speaks volumes, the "Some People" you refer to are likely to go bankrupt trying to pay their mortgage and utility bills, they will not have money for presents for their children, or anything else to spare, and as for "Excess Food" lots of people will not have enough, never mind any excess, I think you ought to consider your words before speaking, and actually do some research on poverty, according to Shelter the national Homeless charity as many as 1 in 3 of us could be made homeless in the new year, so no, a deep recession and stringent austerity measures are not what is called for, a rapid change of Government is what is called for, a General Election, as is our democratic right, but one which the sitting tenants are continuing to deny us in the face of total loss of public confidence

I don't know you, or know anything about you, but your words suggest you have always been well provided for, and not had any real struggles in your life, I have worked hard all of mine, I have had a small business which failed due to the last recession, following that I have had a number of jobs including 25 years in retail, not a well paid profession, my partner is a former nurse who left the profession after much soul searching and a bout of severe depression following the near impossible demands placed on her and her colleagues by the pandemic, we have known hardship in our lives, my partner was at one time homeless too, and I have come close to it myself as a mortgage holder, so please don't be glib about these awful pressing issues, it does you no credit regards Julie

Thanks Julie. Well said.

 

[Jameshow]

Im not sure i get the inflation comment my wages havent inflated, although being self employed i could try it on the next quote

The actual value of your repayments is decreasing due to inflation.

Also I think inflation is stubbornly high due to Ukraine war, fuel prices, cost of covid etc.

But I'm not an economist!!

 

[Keith Cocker]

I stand by the generalisation that as a society we are profligate and wasteful, and that a recession may promote more thoughtful consumption of the financially and environmentally destructive.

We are indeed. And no it won’t. It will just cause hardship and damage to a section of the population. Those most responsible will suffer least if at all. And when it’s “over” we will go back to our old ways until the “next one”.

 

[sploo]

Helluva hot take that DW.

To be fair to DW (and the Scots); wasn't one of the arguments against the previous Scottish independence vote something along the lines of "if you leave the UK then you'll be out of the EU"... then a few years later we English voted to leave the EU and dragged the Scots (who voting majority remain) out anyway.

I'm not pro Scottish independence, but I couldn't exactly blame them for telling us to "something" off...

 

[sploo]

The actual value of your repayments is decreasing due to inflation.

Also I think inflation is stubbornly high due to Ukraine war, fuel prices, cost of covid etc.

But I'm not an economist!!

That kinda only works if your wage is also rising by the rate of inflation. But depending on your outstanding mortgage balance and interest rate it may not be true regardless (my mortgage repayment is nearly 30% higher now than it was at the start of the year; due to being on a tracker).

 

[Jameshow]

That kinda only works if your wage is also rising by the rate of inflation. But depending on your outstanding mortgage balance and interest rate it may not be true regardless (my mortgage repayment is nearly 30% higher now than it was at the start of the year; due to being on a tracker).

Hence why you want to fix!!

 

[John Brown]

That's a "box score question".

as in "i'll tell you the answer after they do it".

It's very difficult when anything isn't competitive to keep it efficient and not allow people to beat whatever it is to death with legal challenges or red tape.

In the US, we have not for profit electric co-ops. They are so rule laden that I think they do share a little more of the rates with their employees, but they also lobby the utility commissions to get higher rates and then the whole point of having not for profits is lost. Then, they start getting in disputes with their labor and giving away benefits or giving in to requests that nobody else would.

I'd say if anything, those would be great places to get a terminal job if one wanted out of the rat race. Sewer authorities, etc, much the same. Well capitalized, disinterested in efficiency and full of well connected people getting a 90K job that has benefits you couldn't dream of. The 90k part isn't exactly executive pay, but they come with pensions, postretirement medical and no cost medical while active and all kinds of other fringes.

I'm not sure if you read what I wrote. There are folks on the left(you know, "commies"), who clamour for renationalisation of the utility companies. Their point is that the private utility companies are run for the benefit of the shareholders, added to which a lot of our utility companies are owned by nasty foreigners. My point is/was that, because of the way the energy market works these days, whereby you can buy your gas or electricity from anywhere(even though it comes through the same pipes/cables, and looks, smells and feels exactly the same - which is very confusing), a state owned utility company would have to be competitive, or it wouldn't get off the ground. So we don't have to renationalise the entire industry.
I don't personally know if a state run energy supplier, competing in the open market would work or not. I'm merely saying that it would only need a minimal cost experiment to find out.

 

[sploo]

Hence why you want to fix!!

I guess it depends on whether the available fix rates are actually higher than your tracker (for me at the moment, probably yes). Granted that doesn't consider the future.

 

[Terry - Somerset]

There is no crystal ball which reliably indicates what will happen to interest rates in the future.

The best estimate is the current market for loans of differing terms. This is what professionals trading in the money markets are betting on - whether you have any fondness for them as a breed is unimportant, but they are the best informed.

The real issue for individuals is about risk and affordability. There is no right answer as we all have a different circumstances and attitudes towards risk:

• a tracker mortgage wholly exposes you to interest rate changes, but in principle should be the cheapest long term as this carries the biggest risks. Not my choice as I am risk averse.
• fixing the mortgage eliminates risk. In simple economic terms the longer the fix, the more risk passes to the lender who will want to be compensated. They do not absorb risk for free.
• A 2 year deal would get past the next election, hopefully to the end of imminent recession, and inflation back under some sort of control. What happens then is a risk.
• A 5+ year deal is a long term commitment - lots can change both in the wider economy and personal circumstances. The attraction is that risk is removed long term - but understand what it might cost if you needed to end the loan early.

If it is affordable, fixing the rate = no worries.

My personal choice would be a 2 year deal. If rates increased significantly after that it would likely indicate a broken economic model. All bets on the fallout would be very difficult to anticipate - fall in house prices, negative equity, widespread inability to pay, unemployment, trashed exchange rate etc.

 

[johna.clements]

And that is relevant because?

Because we can no longer benfit from the EU's agreement about sending people back to safe countries in the EU. We voted to leave the EU and its agreements.

 

[Jacob]

There is no crystal ball which reliably indicates what will happen to interest rates in the future.

The best estimate is the current market for loans of differing terms. This is what professionals trading in the money markets are betting on - whether you have any fondness for them as a breed is unimportant, but they are the best informed.

The real issue for individuals is about risk and affordability. There is no right answer as we all have a different circumstances and attitudes towards risk:

• a tracker mortgage wholly exposes you to interest rate changes, but in principle should be the cheapest long term as this carries the biggest risks. Not my choice as I am risk averse.
• fixing the mortgage eliminates risk. In simple economic terms the longer the fix, the more risk passes to the lender who will want to be compensated. They do not absorb risk for free.
• A 2 year deal would get past the next election, hopefully to the end of imminent recession, and inflation back under some sort of control. What happens then is a risk.
• A 5+ year deal is a long term commitment - lots can change both in the wider economy and personal circumstances. The attraction is that risk is removed long term - but understand what it might cost if you needed to end the loan early.

If it is affordable, fixing the rate = no worries.

My personal choice would be a 2 year deal. If rates increased significantly after that it would likely indicate a broken economic model. All bets on the fallout would be very difficult to anticipate - fall in house prices, negative equity, widespread inability to pay, unemployment, trashed exchange rate etc.

No need for crystal balls - one way or another it needs tight state control so that that innocent non-speculating home buyers/occupiers will be secure. And also to constrain prices instead of the mad free-for-all disruption of the last 50 or more years, with our lives ruled by gamblers and profiteers.

 

[evildrome]

If you can afford it I'd fix for 5 years I cannot see rates coming down much if at all.

With inflation at 10% your payments are 10% less each year anyhow.

The Fed has overtightened and there is a severe Global recession coming.

CB's are gagging to get back to doing QE. I think rates will be back to 2% within 18 months.

 

[Jameshow]

The Fed has overtightened and there is a severe Global recession coming.

CB's are gagging to get back to doing QE. I think rates will be back to 2% within 18 months.

View attachment 146771

I think in 2 years time we will be at 5% inflation and 5% interest rates.

According to economist mystic meg this morning!!

 

[Thingybob]

What gets me is as commodities rise in price companys will hold Sales so they sell more and tell us they are helping with the cost of living , Be ready for pre/post Christmas /January/2023 Sales any name they can think of to get us back in store or online they wont disapear just come back rebranded re owned ready to take our cash its a cycle