LIBOR being discontinued

[slf2012]

Had a quick search and couldn’t see this being discussed anywhere else on PH, so what’s the general consensus on what will happen to interest rates when LIBOR is discontinued?

I have a mortgage which is LIBOR linked, and is currently very cheap, at LIBOR plus 2%.

Am I likely to lose out when a new standard interest rate is put in place, or is it much ado about nothing?

Thanks in advance.

[CharlesElliott]

It will be replaced with either a fallback rate (as per your agreement) or something like SONIA I expect.

I'm a bit surprised your lender hasn't already contacted you.

[Sheepshanks]

There was a bit of a discussion about it a couple of months ago: https://www.pistonheads.com/gassing//topic.asp?h=0...

I'm sure it was also mentioned as it might have effect on some pensions, but I can't immediately find that.

[slf2012]

CharlesElliott said:

It will be replaced with either a fallback rate (as per your agreement) or something like SONIA I expect.

I'm a bit surprised your lender hasn't already contacted you.

The lender has contacted me, but just to say they don’t know what will happen. I took that to mean it’s likely to cost me money!

I’ve done a quick search for SONIA, what I’ve found indicates that will be the defining rate in future.

Thanks.

[slf2012]

Sheepshanks said:

There was a bit of a discussion about it a couple of months ago: https://www.pistonheads.com/gassing//topic.asp?h=0...

I'm sure it was also mentioned as it might have effect on some pensions, but I can't immediately find that.

Thanks for the link. I’ll take a look.