Jump to content
House Price Crash Forum
Sign in to follow this  
pajd

Mortgage Rate Question

Recommended Posts

Maybe a thick question but as someone who is new to mortgages i'll ask anyway......... :ph34r:

A mortgage is fixed at 4.25% for 2 years then after that it changes to 3.99% and linked to the BOE rate.

What percent would it be if rates hit 5%? Or is this one of those "how long is a piece string" questions?

Thanks for any help

Edited by pajd

Share this post


Link to post
Share on other sites

If it is linked to BOE rate then its 3.99 +BOE = new rate. So if BOE is at 5% then new rate is 8.99%.

Here is a link to SVR rates and how they linked to BOE rate historically.

http://www.housepricecrash.co.uk/forum/index.php?showtopic=68017&view=findpost&p=2890449

Thanks doccyboy

So a 140k mortgage is just over £1100 per month in that case once the rate hits 8.99% :o That seems a bit high does it not?

My cirumstances are

25k deposit

House price limit 140k

On moneysupermarket the lowest mortgage rate is 2 years fixed at 4.25% then reverts to 3.99% plus BOE

Share this post


Link to post
Share on other sites

To get a good rate for 5 years (which is a safer option in my opinion ) then your 25k will need to be 20% of valuation. So that means that you will be looking at a house with valuation not asking price of 125K. So you need to bargain hard. Remember you will need to keep some money back for legal fees - mortgage arrangement fee- survey fee and incidental expenses of moving in. So be very careful of the house you will buy and make sure you get it for a price that a valuer is going to agree with.

I have a seperate savings account for legal fees, 6 months worth of mortgage payments etc. The 25k is for a deposit. Not many 125k houses around here sadly

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 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
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.