What are the chances that savings accounts will apply this increase!
Era of free lending is ended. Thankfully.
Interest rates are to asset prices what gravity is to matter – Warren Buffett.
It’s why everything largely bought with credit paid over years (cars, houses) have rapidly increased in price.
Should I now crack open my neighbours head and feast on the goo inside?
Interest rates are something I know absolutely about. Anyone got an ELI5 guide? What practical effect does this sort of thing have on the normal person?
Whoop-de-doo! But what does it all mean, Basil?
Does someone have a choice of paying back the principle or the interest when making repayments? If the principle owed is reduced, will that reduce the interest owed?
Fixed at 3.10% for 10 years last week, in anticipation of this and more hikes over the next 18 months.
You don’t have a choice when making your regular payments. Each payment mostly pays the interest and takes a smaller amount off the principal. This ratio changes the longer you pay your mortgage. If you can overpay your mortgage (some fixed rates have penalties for doing so) this is taken from the principal, which reduces your monthly repayment or reduces the length of your mortgage.
Some of us are about to find out what a tracker mortgage is!
I have a feeling that the people who fixed long term over the next decade will have gotten the same luck as the people who had trackers for the past decade.
Fair play to anyone on a tracker who gave it up in the past few months to fix long term
10 comments
What are the chances that savings accounts will apply this increase!
Era of free lending is ended. Thankfully.
Interest rates are to asset prices what gravity is to matter – Warren Buffett.
It’s why everything largely bought with credit paid over years (cars, houses) have rapidly increased in price.
Should I now crack open my neighbours head and feast on the goo inside?
Interest rates are something I know absolutely about. Anyone got an ELI5 guide? What practical effect does this sort of thing have on the normal person?
Whoop-de-doo! But what does it all mean, Basil?
Does someone have a choice of paying back the principle or the interest when making repayments? If the principle owed is reduced, will that reduce the interest owed?
Fixed at 3.10% for 10 years last week, in anticipation of this and more hikes over the next 18 months.
You don’t have a choice when making your regular payments. Each payment mostly pays the interest and takes a smaller amount off the principal. This ratio changes the longer you pay your mortgage. If you can overpay your mortgage (some fixed rates have penalties for doing so) this is taken from the principal, which reduces your monthly repayment or reduces the length of your mortgage.
Some of us are about to find out what a tracker mortgage is!
I have a feeling that the people who fixed long term over the next decade will have gotten the same luck as the people who had trackers for the past decade.
Fair play to anyone on a tracker who gave it up in the past few months to fix long term