Rates cut to 0.5%

[leeb]

Oh the joy of mortgage dilemmas!

My fixed rate runs out in may, has been 4.99% for 3yrs

Woolwich automatically put me onto a variable rate, at 0.99% above bank of england base rate.

Meaning until they go up th 4% I'm having good times, well paying the wedding off.

But will it be more difficult to get a decent fixed rate when bank of england start increasing their rate?

The cheapest fixed I've been offered so far is 6.49%

Hhhmmmm

[G_T]

Fittster said:

G_T said:

richyb said:

I'm holding out for -0.5%. Come on Gordon you've tried everything else.

It won't go negative IMO;

Err, if interest rates are less than inflation isn't it already negative for practical purposes?

I'm referring to the bank of England interest rate and no it isn't.

For example I'm still getting more in interest than I pay in taxes on my savings even with the rate cut.

ISA's might become the only way of saving with interest now though.

[JagLover]

anonymous said:

[redacted]

They stayed low quite a few years in Japan (which suffered a similar property boom & bust). However I think the problem in a year or 2 will be inflation, not deflation, so I view base rates this low as a short term policy.

[jshell]

JagLover said:

anonymous said:

[redacted]

They stayed low quite a few years in Japan (which suffered a similar property boom & bust). However I think the problem in a year or 2 will be inflation, not deflation, so I view base rates this low as a short term policy.

But, will 'asset-rich' people not be in a good position, come these times of high inflation?

[scotal]

leeb said:

Oh the joy of mortgage dilemmas!

My fixed rate runs out in may, has been 4.99% for 3yrs

Woolwich automatically put me onto a variable rate, at 0.99% above bank of england base rate.

Meaning until they go up th 4% I'm having good times, well paying the wedding off.

But will it be more difficult to get a decent fixed rate when bank of england start increasing their rate?

The cheapest fixed I've been offered so far is 6.49%

Hhhmmmm

That's an interesting rate. Super high LTV?

[Matt..]

I personally find it worrying that the gov isn't trying to promote responsible borrowing more. It seems like the gov just want us to borrow as much as we can, and not think about the future. We really are going to struggle when rates rise and people suddenly realise that mortgages actually cost a lot of money.

Why is it that a solution to a country full of people in debt, is to make it cheaper and easier to get into more debt?

[scotal]

JagLover said:

anonymous said:

[redacted]

They stayed low quite a few years in Japan (which suffered a similar property boom & bust). However I think the problem in a year or 2 will be inflation, not deflation, so I view base rates this low as a short term policy.

Anyone else think they will be under hoooge political pressure not to raise rates prior to a general election?

[Fittster]

G_T said:

Fittster said:

G_T said:

richyb said:

I'm holding out for -0.5%. Come on Gordon you've tried everything else.

It won't go negative IMO;

Err, if interest rates are less than inflation isn't it already negative for practical purposes?

I'm referring to the bank of England interest rate and no it isn't.

For example I'm still getting more in interest than I pay in taxes on my savings even with the rate cut.

ISA's might become the only way of saving with interest now though.

You not allowing for inflation. To get a positive rate of return you need to beat it.

[ipitythefool]

Matt.. said:

So it looks like we as a country are again being setup for a massive fall. When interest rates rise (and they most definately will), they are likely to go up in quite a big way. So say in 5yrs time rates are at 8%, how screwed is everyone going to be?

Would we be any more screwed than if base rates were now at 3% instead of 0.5%?

It's not as if new mortgages are anywhere near 0.5%. If they were then you'd have a point.

[cliffe_mafia]

hoppy2008 said:

Scotal, any links to which lenders have passed on the cut?

Cheers

Hoppy

I bookmarked this one last time - they update it frequently.

http://www.thisismoney.co.uk/mortgage-cuts

[Matt..]

jshell said:

But, will 'asset-rich' people not be in a good position, come these times of high inflation?

Not if you can't pay the mortgage because the money you earn is worth much less.

[robm3]

Andy Zarse said:

Racingdude009 said:

Or savers withdraw money to spend it on cars, holidays, house improvements ect.

Also people borrowing to do the same result economy comes out of recession.

Do you think it's a good thing for society generally if everyone disposes of their savings to spend on cars, holidays etc?

Only bad for our kids... ~now where's that Porsche GT3 order form

[G_T]

Fittster said:

G_T said:

Fittster said:

G_T said:

richyb said:

I'm holding out for -0.5%. Come on Gordon you've tried everything else.

It won't go negative IMO;

Err, if interest rates are less than inflation isn't it already negative for practical purposes?

I'm referring to the bank of England interest rate and no it isn't.

For example I'm still getting more in interest than I pay in taxes on my savings even with the rate cut.

ISA's might become the only way of saving with interest now though.

You not allowing for inflation. To get a positive rate of return you need to beat it.

Fair enough.

I do still stand by my initial comments though. If the unenlightened public (like me apparently!) see the headlines stating that they now have to pay the banks (whom are generally blamed for this mess) there's going to be withdrawls en mass.

Whether they're worse off or not is irrelevent in my opinion. Mass hysteria normally wins.

[jshell]

Matt.. said:

jshell said:

But, will 'asset-rich' people not be in a good position, come these times of high inflation?

Not if you can't pay the mortgage because the money you earn is worth much less.

Good point, and thank fvck I'm paid in Euros during these turbulent times!

[ZondaMan]

G_T said:

Fittster said:

G_T said:

Fittster said:

G_T said:

richyb said:

I'm holding out for -0.5%. Come on Gordon you've tried everything else.

It won't go negative IMO;

Err, if interest rates are less than inflation isn't it already negative for practical purposes?

I'm referring to the bank of England interest rate and no it isn't.

For example I'm still getting more in interest than I pay in taxes on my savings even with the rate cut.

ISA's might become the only way of saving with interest now though.

You not allowing for inflation. To get a positive rate of return you need to beat it.

Fair enough.

I do still stand by my initial comments though. If the unenlightened public (like me apparently!) see the headlines stating that they now have to pay the banks (whom are generally blamed for this mess) there's going to be withdrawls en mass.

Whether they're worse off or not is irrelevent in my opinion. Mass hysteria normally wins.

Nominal (headline) rates don't go negative, whether it be the base rate or individual banks' rates; real rates (that's after considering inflation) can.

[BlueEyedBoy]

Bsmithmilne said:

Means my Mortgage is now 0.5% Im so glad I took the staff deal now

Have you checked out the Tax implications!.....

[G_T]

ZondaMan said:

G_T said:

Fittster said:

G_T said:

Fittster said:

G_T said:

richyb said:

I'm holding out for -0.5%. Come on Gordon you've tried everything else.

It won't go negative IMO;

Err, if interest rates are less than inflation isn't it already negative for practical purposes?

I'm referring to the bank of England interest rate and no it isn't.

For example I'm still getting more in interest than I pay in taxes on my savings even with the rate cut.

ISA's might become the only way of saving with interest now though.

You not allowing for inflation. To get a positive rate of return you need to beat it.

Fair enough.

I do still stand by my initial comments though. If the unenlightened public (like me apparently!) see the headlines stating that they now have to pay the banks (whom are generally blamed for this mess) there's going to be withdrawls en mass.

Whether they're worse off or not is irrelevent in my opinion. Mass hysteria normally wins.

Nominal (headline) rates don't go negative, whether it be the base rate or individual banks' rates; real rates (that's after considering inflation) can.

Ah.

Well you live and learn. You seem to know a lot about this. It's not your fault is it?

Edited by G_T on Thursday 5th March 13:54

[ZondaMan]

G_T said:

ZondaMan said:

G_T said:

Fittster said:

G_T said:

Fittster said:

G_T said:

richyb said:

I'm holding out for -0.5%. Come on Gordon you've tried everything else.

It won't go negative IMO;

Err, if interest rates are less than inflation isn't it already negative for practical purposes?

I'm referring to the bank of England interest rate and no it isn't.

For example I'm still getting more in interest than I pay in taxes on my savings even with the rate cut.

ISA's might become the only way of saving with interest now though.

You not allowing for inflation. To get a positive rate of return you need to beat it.

Fair enough.

I do still stand by my initial comments though. If the unenlightened public (like me apparently!) see the headlines stating that they now have to pay the banks (whom are generally blamed for this mess) there's going to be withdrawls en mass.

Whether they're worse off or not is irrelevent in my opinion. Mass hysteria normally wins.

Nominal (headline) rates don't go negative, whether it be the base rate or individual banks' rates; real rates (that's after considering inflation) can.

Ah.

Will you live and learn. You seem to know a lot about this. It's not your fault is it?

Ha, no. I suppose Brown will try to blame anyone but himself though. Don't hurt me.

Edited by ZondaMan on Thursday 5th March 13:56

[ipitythefool]

Matt.. said:

I personally find it worrying that the gov isn't trying to promote responsible borrowing more. It seems like the gov just want us to borrow as much as we can, and not think about the future. We really are going to struggle when rates rise and people suddenly realise that mortgages actually cost a lot of money.

Why is it that a solution to a country full of people in debt, is to make it cheaper and easier to get into more debt?

How many people do you think are now borrowing irresponsibly? You need at least a 20%-25% deposit to get a mortgage. Is that irresponsible?

[ZondaMan]

ipitythefool said:

Matt.. said:

I personally find it worrying that the gov isn't trying to promote responsible borrowing more. It seems like the gov just want us to borrow as much as we can, and not think about the future. We really are going to struggle when rates rise and people suddenly realise that mortgages actually cost a lot of money.

Why is it that a solution to a country full of people in debt, is to make it cheaper and easier to get into more debt?

How many people do you think are now borrowing irresponsibly? You need at least a 20%-25% deposit to get a mortgage. Is that irresponsible?

Perhaps, but you can't borrow your way out of debt, which is encouraged. It's like someone standing in a bucket and trying to lift himself up with the handle.