lazy farmer
Member
- Location
- som/dor border
Current wages 3.5% inflation 1.9% that’s real growth.
It's extremely weak real growth. When making judgments on where interest rates will go you have to take a wider time frame view than that, take the last decade for example, wages have declined overall in real terms.Current wages 3.5% inflation 1.9% that’s real growth.
I think technology for firms is becoming alot cheaper so I think you have to ignore low investment figures in pounds data. Take our UK minimum wage now going up to £8.21, now look at self service checkouts in the supermarkets, that technology would have been expensive 15 years ago and has come down in price rapidly. If wages go up alot then expect more self service checkouts to appear...Agreed but whilst businesses are choosing to hire rather than invest in kit then real wage inflation will continue to grow.
Agreed. It may well be that we are currently in a sweet spot with record employment and rising wages. I read only today that employment is only really rising because brexit uncertainty has meant investments have put on hold.
Bringing this thread back to life because it seems money is going to get even cheaper to borrow and some AMC agents have recently stated that fixing a mortgage now( because of the economic slowdown due to coronavirus ) could well be a great financial move, even though it doesnt look likely rates will rise for yrs.
1) Some of the above comments in this thread show how quick things can change.
2) Do amc want to see 3 yrs accounts?
3) When people say amc charge a large penalty for paying off fixed loans early , is that ontop of the loan and expected interest or just ontop of the loan?
Did you use the AMC , fix the rate and have to show them your accounts?We just took out a loan to buy some land and you can early repay when ever we want.
I think before the AMC was regulated by the FCA it had some different charges that caught people out when the didn’t understand them properly
All banks and the AMC(part of Lloyds anyway) will not only want your accounts,at least 3 years,but they also use formula, EBIT,and similar,to sift through them to pass their "affordability" and other tests.Gone are the days when you could just borrow on net worth.Did you use the AMC , fix the rate and have to show them your accounts?
Did you use the AMC , fix the rate and have to show them your accounts?
I take it to mean that because the fixed interest rate is now alot lower and the projected interest over the loan period is therefore lower then the penalty for paying it off early is lower, which makes sense. Borrowing a million + will get you a far lower rate than borrowing a few hundred thousand but the rate they offer you depends on your ability to pay it back/risk, your profitability and your assetsso borrowing now means that you are unlikely to have big redemption charges as interest rates are likely to rise in the future? what sort of interest rate would you pay to borrow 1m on interest only just now, fixed for 30 years
You could argue that interest rates are more likely to fall in the future than rise, especially so in the short term. If that's the case then redemption penalties would be an issue with fixed loans. On the other hand if interest rates rose and you had fixed the bank could actually pay you to break the fix as they would find it very easy to resell that low fixed money in a higher interest rate market...so borrowing now means that you are unlikely to have big redemption charges as interest rates are likely to rise in the future? what sort of interest rate would you pay to borrow 1m on interest only just now, fixed for 30 years
Probably 3 to 4% depending on an individual case by case basis ie. risks, servicability, security etcso borrowing now means that you are unlikely to have big redemption charges as interest rates are likely to rise in the future? what sort of interest rate would you pay to borrow 1m on interest only just now, fixed for 30 years