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Fixed Rate Mortgage Cost Hits Highest Level This Year

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http://www.telegraph.co.uk/finance/persona...-this-year.html

The average rate charged on a five-year fixed rate loan for someone with a 25 per cent deposit jumped to 5.7 per cent last month, up from 5.54 per cent in June, according to the figures.

This was the highest level since October last year when the Bank of England base rate was 4.5 per cent and lenders were responding to the fall out from the collapse of US investment bank Lehman Brothers.

The average cost of a two-year fixed rate deal for people borrowing 75 per cent of their home's value also edged ahead to 4.46 per cent, up from 4.45 per cent in June, a level last seen in December.

The increase in the average rates offered to new customers follows a round of repricing during July, as mortgage lenders hiked their rates to reflect higher funding costs.

Banks and building societies also increased the cost of their deals to manage the amount of business they did, as any group which stood out as being too competitive was quickly swamped with applications.

But lenders also took the opportunity to increase the margins they charged on their mortgages, with the margins on two-year fixed rate loans rising to 3.11 per cent above the cost of two-year swap rates, the highest level since the credit crunch began and the highest level many commentators could remember.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, said: "Figures released by the Bank of England this morning show that the cost of mortgage finance rose again in July. This is a trend which is likely to become more pronounced over the next year.

The housing market can only boom on this news.

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Only idiots take out fixed rate mortgages. The only people who profit from these are the banks.

Plenty of mortgages to be had at 3% interest, and interest rates are not going up anytime soon.

Edited by Mammon

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Only idiots take out fixed rate mortgages. The only people who profit from these are the banks.

Plenty of mortgages to be had at 3% interest, and interest rates are not going up anytime soon.

course there are. thanks for the info.

havent you got some flats to buy....they are going up dontchaknow

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Only idiots take out fixed rate mortgages. The only people who profit from these are the banks.

Plenty of mortgages to be had at 3% interest, and interest rates are not going up anytime soon.

Ah! Are you a financial advisor? I am thinking of buying because I am not in debt. Is this wise?

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Only idiots take out fixed rate mortgages. The only people who profit from these are the banks.

Plenty of mortgages to be had at 3% interest, and interest rates are not going up anytime soon.

Yep, quickly fill your boots and buy a house on a BOE Tracker + 2.5/3.0% :lol: It will not look clever even if rates only increased to 3% ! What would it be like with Base rates at 4% plus a 3% margin - the average slavebox will be very unaffordable then. Yes, rates may be low now, but buying a house is normally a 25 year commitment. Even if rates stay low for 2 or three years, by the time higher rates come fixed deals will be expensive too. A 20 year fix could be a smart move, even if it looks expensive today.

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<h4 class="first"> Mortgage Details </h4>

Product Type

Mortgage Lender:

Initial Rate:

Period of initial rate:

Subsequent Variable Rate:

The Overall Cost for Comparison:

Bank Base Rate plus 2.49% for 3 years

Abbey

2.99%

36 months

4.24% for 264 months

4.10% APR

Repayments

Based on a loan amount of 150K, a loan to value of 60% and a term of 25 years

Total Cost over the term:

£239,168.44

Initial Monthly Payment:

£712.14

Subsequent Monthly Payment:

£802.35

Fees

Lenders arrangement fee:

£995.00

CHAPS Fee:

£35.00

Lender Booking fee:

£0.00

Charcol Booking fee:

£0.00

Valuation Fees:

£330.00

Legal Fees:

£126.00

Early Repayment Charges:

2% for 3 years

nice fees, nice 60% LTV, nice early redemption, nice SVR ....rates rising....

now how about a nice mortgage for a FTB and 10% dow.n Not so easy

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Only idiots take out fixed rate mortgages. The only people who profit from these are the banks.

Plenty of mortgages to be had at 3% interest, and interest rates are not going up anytime soon.

Not if you were paying your mortgage throughout the 80's and beyond . ;)

Base rates may not be going up for the quite a few months yet but anything can happen when you least expect it...peace of mind is not a bad thing when you need to budget the bills. ;)

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Guest Daddy Bear
Only idiots take out fixed rate mortgages. The only people who profit from these are the banks.

Plenty of mortgages to be had at 3% interest, and interest rates are not going up anytime soon.

4.99% 10 Year Fix Lloyds C&G (Overpayments allowed) - mind I needed a 60% deposit and it was only available in Jan 2009. When IR fell a further 1% or so in Mar/Apr their rate actually went up and now they have withdrawn the product totally ! What does that tell you?

STR'd in Aug 2007 at the peak

Bought back in May 2009 5 bed detached

32% off peak

I must be an idiot :D

Edited by Daddy Bear

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4.99% 10 Year Fix Lloyds C&G (Overpayments allowed)

STR'd in Aug 2007 at the peak

Bought back in May 2009 5 bed detached

32% off peak

I must be an idiot :D

pride ALWAYS comes before a fall.

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Guest Daddy Bear
pride ALWAYS comes before a fall.

Not pride

Just a message to those on board to listen to my predictions of an inflationary collapse hitting western economies very soon. Shows I have a good track record and am prepared to put my money where my mouth is.

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Not pride

Just a message to those on board to listen to my predictions of an inflationary collapse hitting western economies very soon. Shows I have a good track record and am prepared to put my money where my mouth is.

good track record? Id hold fire on that if I was you. the STR..OK, the coming hyperinflationery holocaust? Id stick to 1 out of 2 if I was you.

is that list YOUR predictions...I was led to a website with a very similar list some time ago.

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Guest Daddy Bear
good track record? Id hold fire on that if I was you. the STR..OK, the coming hyperinflationery holocaust? Id stick to 1 out of 2 if I was you.

is that list YOUR predictions...I was led to a website with a very similar list some time ago.

Yes - my predictions

Also check out these bloo loo from Jan 1st 2007 - ignore the non economic ones - I'd had a bottle or two !

7th or so posts down

http://www.housepricecrash.co.uk/forum/ind...p;#entry2065787

While you are in economics section check out

http://www.housepricecrash.co.uk/forum/ind...howtopic=121543

Thats where I post now

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Here's pride - check out this beauty

black-cochin-cockerel.jpg

my, that is a big black monster with red wrinkly skin flaps.

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Only idiots take out fixed rate mortgages. The only people who profit from these are the banks.

Plenty of mortgages to be had at 3% interest, and interest rates are not going up anytime soon.

Unless of course something unexpected happens and interest rates rocket. Of course that never happens.

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