interestrateripoff

0.89% mortgage deal cheapeat ever

25 posts in this topic

3 minutes ago, oatbake said:

It's a discount to the SVR isn't it? Reel them in and then crank up the SVR due to 'market conditions'. Easy :-)

Shush! You're giving the magic away.

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Interesting to hear David Buick on LBC this morning who a) Wasn't at all keen on these rates and b.) stated that he finished paying off his mortgage 10 years ago, and had calculated the average rate over the period of his mortgage was 12%.

 

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52 minutes ago, oatbake said:

It's a discount to the SVR isn't it? Reel them in and then crank up the SVR due to 'market conditions'. Easy :-)

Can an SVR be whatever the provider decides or are there laws / contract terms that limit it?

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1 hour ago, CunningPlan said:

Interesting to hear David Buick on LBC this morning who a) Wasn't at all keen on these rates and b.) stated that he finished paying off his mortgage 10 years ago, and had calculated the average rate over the period of his mortgage was 12%.

I heard that too. Nick Ferrari moved it away from that topic pronto. Overall most media types are already OO and don't feel comfortable with discussing issues like this. Renting and the plight of housing for the young is distant enough to be debated but not the housing bubble. Its all papered over with affordable/unaffodable and build to solve the crisis.

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31 minutes ago, PropertyMania said:

Can an SVR be whatever the provider decides or are there laws / contract terms that limit it?

Yes.

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Week by week, the numbers of people in this country with a mortgage is diminishing. Older folk are paying theirs off at the end of the terms (possibly earlier thanks to super low IRs) while many younger folk can't afford to buy. In past years, BTL could be relied upon to make up the shortfall, but that game's over too.

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6 hours ago, PropertyMania said:

Can an SVR be whatever the provider decides or are there laws / contract terms that limit it?

As I recall there is some rule in the Consumer Credit Act against extortionate rates, but that would probably only kick in at around 50%, so can be ignored.

But if the rate is out of line with the market then the borrower will just remortgage and go elsewhere. The SVR only kicks in after the redemption penalty period ends. If the borrower is a bad risk they'll have trouble finding a cheap, rate, but that would be the case anyway.

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Get in there everyone.  We live on an Island and they're not making any more land .. and I hear you can only win on bricks and mortar!

 

Complete no-brainer! :lol:

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Looks like an excess credit clear out before the next big con :P

Were on the apex, of a downturn, stretched affordability, looming tax changes (increases in NI / VAT; decreases in corporation taxes).... Who wishes to buy when uncertainty is on the rise B)

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2 hours ago, 65243 said:

As I recall there is some rule in the Consumer Credit Act against extortionate rates, but that would probably only kick in at around 50%, so can be ignored.

But if the rate is out of line with the market then the borrower will just remortgage and go elsewhere. The SVR only kicks in after the redemption penalty period ends. If the borrower is a bad risk they'll have trouble finding a cheap, rate, but that would be the case anyway.

Cheers. So basically SVR is like an instant access savings account vs say a 5 year bond with fixed rate of interest?

 

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9 hours ago, rantnrave said:

Week by week, the numbers of people in this country with a mortgage is diminishing. Older folk are paying theirs off at the end of the terms (possibly earlier thanks to super low IRs) while many younger folk can't afford to buy. In past years, BTL could be relied upon to make up the shortfall, but that game's over too.

Yes Nationwide have already expressed worry about falling net interest margin. Though other lenders are slashing costs by reducing branch head count and introducing technology. 

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20 hours ago, PropertyMania said:

Cheers. So basically SVR is like an instant access savings account vs say a 5 year bond with fixed rate of interest?

 

That's right. To get the attractive fixed low interest rate you have to tie yourself into the deal for anything between 2 and 10 years. During that time you face a stiff "redemption penalty" if you want out of the mortgage. Once that time is up you automatically get bumped onto the lender's standard variable rate (SVR). That will usually be higher, but not deliberately punitive. It applies to all of their borrowers who are not on a special deal, ie those who are too disorganised or lazy to refinance, or those who are credit-impaired or for some other reason wouldn't qualify for a special deal.

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4 hours ago, 65243 said:

That's right. To get the attractive fixed low interest rate you have to tie yourself into the deal for anything between 2 and 10 years. During that time you face a stiff "redemption penalty" if you want out of the mortgage. Once that time is up you automatically get bumped onto the lender's standard variable rate (SVR). That will usually be higher, but not deliberately punitive. It applies to all of their borrowers who are not on a special deal, ie those who are too disorganised or lazy to refinance, or those who are credit-impaired or for some other reason wouldn't qualify for a special deal.

Or those were the cost of refinancing doesn't save them any money.

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Is there an official lending target?....very much looks like there could be....can't do much more to incentivise people to take on ever more debt.....with a promise of future earnings......still those that can't pay wont pay, there are no debtor prisons, I suppose once they have spent it they have done half the job, managed to get the money into the economy, full repayment is just the icing on the cake, fingers crossed and hope to be.;) 

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This story is BS. HSBC a few years ago had a lifetime tracker at base rate + 0.38%, which gave 0.88% for several years and would now give 0.63%. It made servicing a mortgage after the financial crisis very very cheap. From memory the LTV required was perhaps 80%.

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A colleague remortgaged his house 2 years ago because the "deals were so good". He bought it in 2014. He borrowed more when he remortgaged, home value "had gone up". He took some money from it to buy himself and wife each spanking new cars and a new kitchen.

He has been trying to sell his home, £100k over priced, been on the market for 8 months and one 10k reduction. He is not going to drop further as he has to be able to pay off the mortgage and have deposit for new home.

i wonder how many other idiots have done a similar thing.

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On 22/04/2017 at 4:31 PM, 65243 said:

That's right. To get the attractive fixed low interest rate you have to tie yourself into the deal for anything between 2 and 10 years. During that time you face a stiff "redemption penalty" if you want out of the mortgage. Once that time is up you automatically get bumped onto the lender's standard variable rate (SVR). That will usually be higher, but not deliberately punitive. It applies to all of their borrowers who are not on a special deal, ie those who are too disorganised or lazy to refinance, or those who are credit-impaired or for some other reason wouldn't qualify for a special deal.

Useful, thanks. 

US economy said to be less sensitive to interest rate changes than the UK because most mortgages on a 30 year fix. Probably a good thing as gives central bank less power. 

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On ‎22‎/‎04‎/‎2017 at 8:31 PM, winkie said:

Is there an official lending target?

£100bn in last August's Term Funding Scheme

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On 22/04/2017 at 11:24 PM, mathschoc said:

A colleague remortgaged his house 2 years ago because the "deals were so good". He bought it in 2014. He borrowed more when he remortgaged, home value "had gone up". He took some money from it to buy himself and wife each spanking new cars and a new kitchen.

He has been trying to sell his home, £100k over priced, been on the market for 8 months and one 10k reduction. He is not going to drop further as he has to be able to pay off the mortgage and have deposit for new home.

i wonder how many other idiots have done a similar thing.

Could they not sell the cars for a deposit?

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