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Muddy
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03-11-2017, 02:46 PM
21

Re: UK interest rates rise for first time in 10 years

Originally Posted by realspeed ->
There has been too much emphises on borrowers. The savers who invest the money have been given a rotten time for far too long. Without the savers there would be no money for banks and building societies to lend.
It is about time the bank of England started to put interest rates up to a decent level starting off at say 5% to give savers a decent return on their capital.

I agree .
Savers have seen their savings going down the plug hole and with inflation at 3% minuscule interest doesn't make that much difference.
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03-11-2017, 06:24 PM
22

Re: UK interest rates rise for first time in 10 years

Originally Posted by Morticia ->
Put like that I have to agree with you.

Anyone who can already afford to pay over a grand a month on a mortgage shouldn't even flinch at an extra £39.
Indeed. The current rise is insignificant compared to the rises of the past, when 1 or 2% rises were common and which really hurt people's finances.

For example, currently:

A £300,000 mortgage @ 4% over 25 years costs about £1,584 pm

An increase of 2% would increase the payment to £1,933 pm - if my calculations are correct, that's an increase of £349 pm.

Even a mere 1% increase would entail in increase of £179 pm.

Now, those rises would really hurt!

I can recall rates rising so much that building societies were extending payment periods because borrowers were unable to cope with rate increases.

http://www.independent.co.uk/money/m...0s-787630.html

In 1991 mortgage repossessions – people losing their homes – hit a record of 75,000. Interest rates went from 8 per cent to 13 per cent in six months
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06-11-2017, 12:21 AM
23

Re: UK interest rates rise for first time in 10 years

If this happens the housing market would collapse surely?
Mass repossessions would only exaserbate the homeless crisis ?
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06-11-2017, 12:46 AM
24

Re: UK interest rates rise for first time in 10 years

Originally Posted by Muddy ->
If this happens the housing market would collapse surely?
The 1991 rates are unlikely in the foreseeable future and will not, therefore, be the cause of any such collapse.

Originally Posted by Muddy ->
Mass repossessions would only exaserbate the homeless crisis ?
Lenders learned their lesson in 1991 - it was impossible to sell repossessions because increased repayments had forced borrowers into a situation of negative equity and they could not afford to move, so, nowadays, repossession is a last resort, not a first one.
 
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