How long is a piece of string - interest rates

Dragon

Member
Location
Cornwall
Regarding brexit and the likelihood of increased inflation.
The reasoning with higher inflation, interest rate will rise to help control it. But but how far can rates rise before having a negative effect on the economy - due to high debt in all parts of the economy.
I'm looking at "New money" and trying to work out what possibilities could unfold. All to with fixing now or 1-2 years time or staying variable

Thanks for replies and thoughts
 
Last edited:

Daniel

Member
Our bet was that rates will rise in the 5-10 year term. We've just fixed a reasonable sum for 15 years at 3.05%.

The variable rate was not substantially cheaper and libor would only need to rise by 2% in the second 7.5 years of the term to cancel out the saving in the first.

In 2004 we took a mortgage at 7.5% variable rate and no one would have said you could knock 5% off that by 2016. It won't take much for libor to go from the current 0.5% to 2.5% in 15 years.
 
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Dragon

Member
Location
Cornwall
3% good was that 1-2 weeks ago or more, better deals for shorter term fix, since discussing with the bank fixed rates have increased by 0.5%.
Have been offered 3.74% for 25 yrs.
 

Dragon

Member
Location
Cornwall
Wife's in the money game so it helped when sitting down with the bank , was an arrangement fee thou but glad we done it
arrangement on top? cant really go wrong with 2.25% fixed,
the banks margin have risen in 12 months where as cost of funds has reduced , even though overall cost is the same.
 

Sid

Member
Livestock Farmer
Location
South Molton
did you take it. I would expect they have risen now
Had 3 offers on the table. But we went with our long standing bank that have shown that the have great customer service and understand our business. We fixed half and went variable with half. Will spread the risk.
 

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