UK Bank Interest Rates and Mortgage Costs

[Prakhonchai Nick]

Most folk in the UK are panicking that they cannot afford their mortgage payments. BoE base rate up to 5%!!!!!!!!

These are the people who took out mortgages in the past 12-15 years when interest rates were very low. They should have had the foresight to realise such low rates would not last forever.

Taken over the past 40-45 years, todays rates are low. Back in the 70's 80's and 90's when I and many other expats here were paying a motgage, rates were more than double todays rates.

Folk have only themselves to blame for not doing their homework! Som Nom Na!

Bank Rate history and data | Bank of England Database

www.bankofengland.co.uk

 

[Yorky]

Taken over the past 40-45 years, todays rates are low. Back in the 70's 80's and 90's when I and many other expats here were paying a motgage, rates were more than double todays rates.

I think I remember 16% sometime in the mid 70s. It was certainly crippling. Luckily our first mortgage was only £3,000.00.

Always remember - "rates can go up and down"

 

[nomad97]

I certainly remember interest rates in the double figures in the 1990s or thereabout. Most people in recent years have been living in dreamland with less than 1 % interest rates.

 

[CO-CO]

Most folk in the UK are panicking that they cannot afford their mortgage payments. BoE base rate up to 5%!!!!!!!!

These are the people who took out mortgages in the past 12-15 years when interest rates were very low. They should have had the foresight to realise such low rates would not last forever.

Taken over the past 40-45 years, todays rates are low. Back in the 70's 80's and 90's when I and many other expats here were paying a motgage, rates were more than double todays rates.

Folk have only themselves to blame for not doing their homework! Som Nom Na!

Bank Rate history and data | Bank of England Database

www.bankofengland.co.uk

I recall seeing a presentation from the bank's economist where he showed a chart of base rates from 1920 to 1990's.

He drew a line at 10% and base rate had spent more time above the line than below.

@Prakhonchai Nick is spot, people have been lulled into a false sense of security with artificially low interest rates. Low interest rates do fuel the economy and encourage spending. The Bank of England have that rates will fall as inflation is brought under control.

Their forecasts for the timing of that is no better than my predictions on GBP/THB exchange rates!

 

[Coffee]

These are the people who took out mortgages in the past 12-15 years when interest rates were very low. They should have had the foresight...

...Folk have only themselves to blame for not doing their homework! Som Nom Na!

Wouldn't these folks you're referring to above be on adjustable-rate mortgages ?

Those who paid a bit more and took out low fixed-rate mortgages wouldn't be too hard pressed.

 

[Ivor the Engine]

I hear that pension will go up again next year by a good rate like this year (10.1%). I understand that an official announcement will be made in September. Might be worth me holding back on taking my pension due shortly afterwards?

 

[nomad97]

I hear that pension will go up again next year by a good rate like this year (10.1%). I understand that an official announcement will be made in September. Might be worth me holding back on taking my pension due shortly afterwards?

I heard that too. Good thinking batman.

 

[CO-CO]

I hear that pension will go up again next year by a good rate like this year (10.1%). I understand that an official announcement will be made in September. Might be worth me holding back on taking my pension due shortly afterwards?

Do the maths.

How many payments would you need to sacrifice to get the increase?

 

[Ivor the Engine]

You get in increase for each 5 week period, that you hold back your pension.
Will wait until September, then calculate options.

 

[Prakhonchai Nick]

You may get an increase for each period you defer, but unlike in years past, you do nto get the arrears. Just an increased pension

The next increase is based on september 2023 inflation figures, but is not payable until 6th Aprl 2024

I don't like to mention it, but a friend in Buriram paid over £10,000 to increase his pension payment After receiving just a few weeks higher payment,, he died. No refund. The £10,000 he paid would have gone a long way towards helping his widow and young son.

 

[Ivor the Engine]

You may get an increase for each period you defer, but unlike in years past, you do nto get the arrears. Just an increased pension

The next increase is based on september 2023 inflation figures, but is not payable until 6th Aprl 2024

I don't like to mention it, but a friend in Buriram paid over £10,000 to increase his pension payment After receiving just a few weeks higher payment,, he died. No refund. The £10,000 he paid would have gone a long way towards helping his widow and young son.

I have slowed down a lot on my motorbike now, but all good info, as usual.

 

[CO-CO]

You get in increase for each 5 week period, that you hold back your pension.
Will wait until September, then calculate options.

I thought that you meant you hold back claiming so as to get this year's annual increase.

 

[Ivor the Engine]

I thought that you meant you hold back claiming so as to get this year's annual increase.

No, maybe next year's. I will already get the last increase as I'm not able to claim before my December birthday.

 

[CO-CO]

No, maybe next year's. I will already get the last increase as I'm not able to claim before my December birthday.

When I speak of this year's, I am referring to the increase that will be announced around September time, effective April 2024.

So, I assume (quite possibly not correctly) that you would need to defer - or not claim - until 1st April 2024 ??

It is interesting to see your options (although there can't be many on this forum still young enough for it to apply to)