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Daily Mail: Millions Of Households Facing Hike In Interest Rates That Will Put £200 A Month On Home Loans.

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'Millions of households facing hike in interest rates that will put £200 a month on home loans':

http://www.dailymail.co.uk/news/article-1340058/Millions-households-facing-hike-rates-200-month-home-loans.html

Cash-strapped families are ­facing a rise of more than £200 a month in their mortgage bills after Britain’s leading business organisation warned interest rates are about to go up.

Rates will have to rise in the new year to control inflation, the Confederation of British Industry predicts today in its latest economic forecast.

This will add thousands of pounds a year to mortgage bills for millions of households.

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That's very naughty of the CBI to say something like that!

The stench of soiled pants throughout the country is going to be unbearable. At least we've got cold weather.

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That's very naughty of the CBI to say something like that!

The stench of soiled pants throughout the country is going to be unbearable. At least we've got cold weather.

:lol:

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But it added that the chances of a ­double-dip recession are ‘low’.

How's that work then? VAT increase. Energy increase. Wages stagnant. Mortgages rising. Sounds like double dip to me. :o

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it still doesn't mean the banks won't put their rates up anyways.

Depends on who the banks are getting the funding from the markets and have to pay market interest rate or the good old BoE where it can pay next to nothing.

Although the more likely scenario is they charge the market rate whilst getting the money from the BoE.

Edited by interestrateripoff

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Depends on who the banks are getting the funding from the markets and have to pay market interest rate or the good old BoE where it can pay next to nothing.

Although the more likely scenario is they charge the market rate whilst getting the money from the BoE.

That's exactly what I mean. There's no real competition in the banking sector. Only a daft rush towards those who screw you the least.

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Bloomberg's article on the CBI interest rate warning.

http://www.bloomberg.com/news/2010-12-20/bank-of-england-to-start-raising-interest-rate-within-six-months-cbi-says.html

BOE Forecast to Raise Interest Rate Within Six Months, CBI Says

The Bank of England will start raising interest rates within six months to curb inflation, the Confederation of British Industry said.

The Monetary Policy Committee will increase its benchmark interest rate by a quarter-point every three months from the second quarter of 2011 until mid-2012, the London-based group said in a report today. It will then step up the pace of increases to end that year with a rate of 2.75 percent.

“The persistent strength of energy and commodity prices is a growing concern, as it is likely to mean that inflation does not fall back quite as sharply as many hope,” said CBI Chief Economic Adviser Ian McCafferty. “Growth at the start of 2011 is likely to be very sluggish, although we do expect the recovery itself to stay on track.”

Bank of England policy makers remain divided over the need to curb inflation or increase bond purchases to counteract the effect on the economy of the government’s fiscal squeeze. Inflation accelerated to 3.3 percent in November, surpassing the government’s 3 percent limit for a ninth month.

Consumer-price growth will “significantly exceed” the central bank’s 2 percent target next year and only fall “just below” the goal in the first quarter of 2012, the CBI forecast. Inflation will end 2012 at 2.4 percent, it said.

The CBI said the economy will grow 0.6 percent in the current quarter before slowing to 0.2 percent in the first three months of 2011. Growth will average 2 percent in 2011, it said, maintaining a September prediction, and accelerate to 2.4 percent in 2012. It also forecasts house prices will fall about 4 percent next year and remain unchanged in 2012.

The Bank of England left its emergency bond-purchase plan unchanged at 200 billion pounds ($310 billion) this month and kept the benchmark rate at a record low 0.5 percent.

MPC member Adam Posen, who has called for the bank to increase stimulus, said last week policy makers shouldn’t “overreact” to inflation, as it may slow below 1 percent in two years. His colleague Andrew Sentance, by contrast, has voted to increase interest rates since June.

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A whole £200 a month? Wow, but surely mortgage holders would have factored modest rises like this before calculating their affordability.....wouldn't they?

Oh yes I forgot the FAs or banks did all this for them.

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'home loans'? 'mortgages', surely. They're much less harmful, being shrewd financial investments. 'loan' indeed, and me with my vases full of twigs as well.

"Home loans" are different to mortgages. Like overdraft and credit cards, home loans can be recalled at any time and the debtor given 30 days to repay the debt or face immediate repossession. With mortgages on the other hand, the bank cannot ask for the money back as long as you keep up with the repayments.

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The base rate (0.5%) and average mortgage rates (typically 5% - 6%) are so removed from one another as to render this article meaningless. The banks will charge what they like and when they like.

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That's exactly what I mean. There's no real competition in the banking sector. Only a daft rush towards those who screw you the least.

Have you noticed how they all take it in turns?

Pulling in the sheep and sending them "running to & fro"

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How's that work then? VAT increase. Energy increase. Wages stagnant. Mortgages rising. Sounds like double dip to me. :o

If they out up interest rates it will be a disaster

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The base rate (0.5%) and average mortgage rates (typically 5% - 6%) are so removed from one another as to render this article meaningless. The banks will charge what they like and when they like.

So true, my has been chargig me 4.5% regardless of

how low interest rates are. You watch them jump to make the increase.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
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