Comments on: Why Current Mortgage Interest Rates Don’t Reflect The Base Rate http://www.findfinancialfreedom.com/110/why-current-mortgage-interest-rates-dont-reflect-the-base-rate Your guide to getting yourself out of debt and out of the rat race Thu, 17 May 2012 23:20:58 +0000 http://wordpress.org/?v=2.5.1 By: Tristan http://www.findfinancialfreedom.com/110/why-current-mortgage-interest-rates-dont-reflect-the-base-rate#comment-4128 Tristan Sat, 28 Mar 2009 09:12:11 +0000 http://www.findfinancialfreedom.com/?p=110#comment-4128 Hey Brodie I know that 4% is still pretty cheap for money but it's the fact that the govt has tried to get the economy going by pumping all this money into the banks and the rates for new money have hardly dropped since the base rate was at 5% - a year ago! I quite agree with you that house prices still need to drop a considerable amount, maybe not 40%, but at least 25%. I was looking at a 2 bedroom, fairly small house in Wells the other day, asking price of £150,000. This property really should be below the stamp duty threshold, somewhere like £120k - £125k. If I had to raise a 10% deposit (which is fairly prudent), I could save up that money in a year, whereas trying to save up a 20% deposit (what the banks are currently asking for) of £150k is £30,000, which would take me best part of three years! Hey Brodie

I know that 4% is still pretty cheap for money but it’s the fact that the govt has tried to get the economy going by pumping all this money into the banks and the rates for new money have hardly dropped since the base rate was at 5% - a year ago!

I quite agree with you that house prices still need to drop a considerable amount, maybe not 40%, but at least 25%.

I was looking at a 2 bedroom, fairly small house in Wells the other day, asking price of £150,000. This property really should be below the stamp duty threshold, somewhere like £120k - £125k.

If I had to raise a 10% deposit (which is fairly prudent), I could save up that money in a year, whereas trying to save up a 20% deposit (what the banks are currently asking for) of £150k is £30,000, which would take me best part of three years!

]]> By: cornish dragon http://www.findfinancialfreedom.com/110/why-current-mortgage-interest-rates-dont-reflect-the-base-rate#comment-4123 cornish dragon Fri, 27 Mar 2009 20:46:15 +0000 http://www.findfinancialfreedom.com/?p=110#comment-4123 Tris it is very unfair to criticize the poor old bankers ! For the first time in 18 years they are doing their jobs correctly..... Implementing a strict minimum deposit of 10% for people with good credit and much more for people with form.... No more than 3 x salary.... may be 3.5x with two reasonable earners. If as you say 90% of mortgages are being refused then this absolutely right. Cutting out all speculative or potentially risky loans without excellent security. Reducing o/d's to businesses that should not have been given them in the first place. Decreasing their ludicrously high fiat ratios and attempting to rebuild deposit ... And getting the stupid tax payer to buy their past mistakes helps no end ;) Attempting to bring their bond and share holders a profit which is after all their job! 4% is ridiculously cheap borrowing...18% in Iceland. It should be a minimum of 10% in the UK ......IMHO and low it will come to pass ! ( I paid 15% on bank business loans in the past ) 0.5% is just a politically inspired joke........ You are quite right domestic property is far too expensive... it needs ANOTHER 40% hair cut. More as wage deflation engulfs the country. Only at 3 times salary plus 10% does it find equilibrium.. http://www.patrick.net/housing/crash.html?ref=thanks_layoff_daily Keep smiling... Austrian Dragon Tris it is very unfair to criticize the poor old bankers !
For the first time in 18 years they are doing their jobs correctly…..
Implementing a strict minimum deposit of 10% for people with good credit and much more for people with form….
No more than 3 x salary…. may be 3.5x with two reasonable earners. If as you say 90% of mortgages
are being refused then this absolutely right.
Cutting out all speculative or potentially risky loans without excellent security.
Reducing o/d’s to businesses that should not have been given them in the first place.
Decreasing their ludicrously high fiat ratios and attempting to rebuild deposit …
And getting the stupid tax payer to buy their past mistakes helps no end ;)
Attempting to bring their bond and share holders a
profit which is after all their job!

4% is ridiculously cheap borrowing…18% in Iceland. It should be a minimum of 10% in the UK ……IMHO and low it will come to pass !
( I paid 15% on bank business loans in the past )
0.5% is just a politically inspired joke……..

You are quite right domestic property is far too expensive… it needs ANOTHER 40% hair cut. More as
wage deflation engulfs the country. Only at 3 times
salary plus 10% does it find equilibrium..
http://www.patrick.net/housing/crash.html?ref=thanks_layoff_daily

Keep smiling…

Austrian Dragon

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