when the bank of england put the interest rate up do the banks put there base rate up the same percentage or more ????

as above

18 Comments

differs from bank to bank

They usually up mortgage rates by the same but not rates paid to savers !

Original Poster

tallpete33

They usually up mortgage rates by the same but not rates paid to savers !


am on 3.5% halifax base rate since my fixed rate finished a year ago , my payments went down by £239 a month , but i can see them going up soon

yozzman1234

am on 3.5% halifax base rate since my fixed rate finished a year ago , … am on 3.5% halifax base rate since my fixed rate finished a year ago , my payments went down by £239 a month , but i can see them going up soon



i am afraid you are right there....you should be expecting an increase

yozzman1234

am on 3.5% halifax base rate since my fixed rate finished a year ago , my … am on 3.5% halifax base rate since my fixed rate finished a year ago , my payments went down by £239 a month , but i can see them going up soon



That's a decent rate but it may be worth looking at a fix in the future. Rates certainly won't go down but everybody's been expecting a rate rise for a year or two now also and it hasn't happened. The BOE were given the remit to fix interest rates so as to combat inflation (i.e. increasing the base rate to stave off inflation where necessary) but as we currently have stagflation (stagnant growth AND inflation) they are reluctant to raise them as it could dent the chance of economic recovery. If anything we may see rates go up by say 0.5% (in my opinion) by year end but the last few times the BOE monetary commitee have met they've voted by a 8-1 or so majority to keep them the same.

Remember that interest rates went up to 15% in Thatchers day, expect the worse.

Inflation is the biggest cause of interest rate increases.

More for borrowers, less for savers.

jamstaruk1972

differs from bank to bank



^^^This.

/thread

Banned

It depends what your mortgage is.
Mine is a lifetime tracker - which means it tracks the base rate. I am currently paying 0.3% above base (0.8%).

Banned

Inactive

Remember that interest rates went up to 15% in Thatchers day, expect the … Remember that interest rates went up to 15% in Thatchers day, expect the worse.



Scaremongering. Nothing more.
There is talk that inflation will drop without the need for interest rate rises. It has been 'hinted' that interest rates will rise before the end of the year, nothing more.

Let's not forget that a 'normal' interest rate is around the 5% mark.
Edited by: "JonnyTwoToes" 16th Feb 2011

JonnyTwoToes

Scaremongering. Nothing more.



Do you dispute the fact?

History often repeats itself, especially with the same style of government.

Inflation is seriously increasing at an alarming rate.

Inactive

Do you dispute the fact?History often repeats itself, especially with the … Do you dispute the fact?History often repeats itself, especially with the same style of government.Inflation is seriously increasing at an alarming rate.



Agree totally. Even worse for those on lower fixed incomes.
For those who want to have a bit more info it may be worth catching BBC Newsnight from last night on the bbc iplayer. They were discussing inflation which one suggestion being to abandon the idea of keeping interest rates low.
Newsnight linky
Just think what that will do for large mortgage payers........

Cant say I didnt tell you so before the election. If you have some spare cash now is the time to use it wisely if you are also carrying large debts.
Edited by: "WoolyM" 16th Feb 2011

Banned

Inactive

Do you dispute the fact?History often repeats itself, especially with the … Do you dispute the fact?History often repeats itself, especially with the same style of government.Inflation is seriously increasing at an alarming rate.



To be factual, Callaghan left this country in an absolute mess, Thatcher had no choice but to raise interest rates (lets not forget what Callaghan did to GBP in '67).

Thatcher gets a lot of crap but she did a lot of good for those willing to get off their **** and work.

What we have at the moment is unsustainable low interest rates.
The problem here has nothing to do with the current government - don't forget the BOE is soley in charge of interest rate changes.

The problem is that banks have piled higher interest above base on new mortgages.
I changed mine two years ago as I knew interest rates where going to plummet. I managed to get 0.3% above base when it was around 5%. Now I'm paying 0.8% (Base of 0.5% + 0.3%).
A similar mortgage deal now is nearer to 2.5% above base.
The people who have gone for trackers based on this figure are going to have problems.

Interests rates WILL rise to a more realistic 5% which means these people will be paying a minimum of 7.5%. They will simply not be able to afford it.

It does make me laugh when people blame current governments for interest rate changes. Get educated.


Edited by: "JonnyTwoToes" 16th Feb 2011

Well my current mortgage deal expires this August, so you can pretty well guarantee that the interest rates will be sky high by then!

I wouldnt like to be in the shoes of people who comepletley maxed out to buy a house in the last few years.

Banned

splatsplatsplat

I wouldnt like to be in the shoes of people who comepletley maxed out to … I wouldnt like to be in the shoes of people who comepletley maxed out to buy a house in the last few years.



Exactly. The next big 'scandal' will be why the banks didn't advise new customers that they'd be having to pay twice as much when interest rates return to normal.
Why can't people take responsibility for their own finances and do a little forecasting? You don't have to be an economist - just a little common sense.

Inactive

Remember that interest rates went up to 15% in Thatchers day, expect the … Remember that interest rates went up to 15% in Thatchers day, expect the worse.Inflation is the biggest cause of interest rate increases.



really cant see this ever happening again as it would just tip this country over the edge

Banned

jamstaruk1972

really cant see this ever happening again as it would just tip this … really cant see this ever happening again as it would just tip this country over the edge



Absolutely.
There will be no reason for interest rates to reach this level. There would be anarchy if it went even close to 10%.
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