Anyone here had financial responsibilities 16/9/92?

[gzoom]

It's Wednesday today, still in September, the IMF has essentially called our Conservative Chancellor out of control.....what can go wrong .

Oh and the BBC is already comparing Keith to Tony last night.

I had zero financial responsibility in 1992, but I have spent most of my adult life 'preparing' for something after watching my parents shot/scream at each other all night long when repossession of our home became a real possibility back than.

What's the saying 'History repeats itself'.......Well thankfully we fixed for 10 years at sub 2% last year and have more than a 'healthy' bankaccount.

I suspect the next few days are going to be not much fun for anyone living in the UK.

 

[Bazzer]

......

I suspect the next few days are going to be not much fun for anyone living in the UK.

Days? You are optimistic.

 

[Slick]

It's Wednesday today, still in September, the IMF has essentially called our Conservative Chancellor out of control.....what can go wrong .

Oh and the BBC is already comparing Keith to Tony last night.

I had zero financial responsibility in 1992, but I have spent most of my adult life 'preparing' for something after watching my parents shot/scream at each other all night long when repossession of our home became a real possibility back than.

What's the saying 'History repeats itself'.......Well thankfully we fixed for 10 years at sub 2% last year and have more than a 'healthy' bankaccount.

I suspect the next few days are going to be not much fun for anyone living in the UK.

I remember buying my first house the week before then, after being miss sold an endowment nearly 2 years previous.

Hopefully the young team are more financially astute than I was at 21.

 

[DCLane]

Like @Slick I'd just taken out an endowment (that did well ) having been persuaded it'd get good returns by a financial adviser / family friend of SWMBO's family.

We then put an offer in on a house the morning the interests rates went up that November. The seller read the BBC daytime radio news, and the house had been empty for some years, so I guessed she'd be concerned. We'd budgeted at a fairly high interest rate so hadn't over-stretched ourselves. Just.

 

[Slick]

Like @Slick I'd just taken out an endowment (that did well ) having been persuaded it'd get good returns by a financial adviser / family friend of SWMBO's family.

We then put an offer in on a house the morning the interests rates went up that November. The seller read the BBC daytime radio news, and the house had been empty for some years, so I guessed she'd be concerned. We'd budgeted at a fairly high interest rate so hadn't over-stretched ourselves. Just.

Of memory serves, it dropped back to around 10% pretty quickly and continued to do so over a period of years.

I remember my brother paying what I thought was a hefty wad of cash at the time for financial advice to get a fixed rate around the 10% mark. My first real lesson about financial products was that they are an overly convoluted way to separate the working man from his cash and if they are offering fixed rates, its because they are pretty certain that they are on the way down and over 30 years of monitoring it has seen that borne out.

 

[bikingdad90]

A lot of the criticism is unjust in my opinion. There is a white paper by the OECD that looked at the G20 and the majority of the countries reduced personal taxes, corporate taxes and land taxes in order to stimulate economic growth, some with successes and some without. What it doesn’t look at it level of government debt, it’s more focused on GDP output.


What I suspect will happen in November is a freeze on government spending, privatisation of services with fixed price contracts which will drive inequality across the country unless Simon Clarke (North East MP) can bring investment up north.

 

[a.twiddler]

The new government's policies are so old, they're new. Seems like you can't teach an old dogma new tricks. Maybe this will bring the political system to life again, by rejuvenating the opposition and making the public believe that there is actually a difference to vote for.

We bought a house in the late 80s and saw all the craziness of mortgage rates going up to 17 or more %. We even got a fixed rate at around 13% thinking it was going to go up and up, which it did, but then came down to well below what we were fixed at with a lot of time to run to the end of the term. Exciting times. We managed to hang on and have been mortgage free for most of this century. We wouldn't want to go through all that again, or wish it on anyone else. Let us hope that someone has the nous to stabilise the situation before it comes to that or a lot of people who are just hanging on by their eyebrows are going to lose their homes, as they did back then.

 

[DCLane]

@Slick - when we got the mortgage for the current house, paid off at the end of 2020, I sat down with a financial adviser and gave them a challenge: if they could beat the rates I got by myself they would get my business. They couldn't come anywhere near.

 

[Gwylan]

The new government's policies are so old, they're new. Seems like you can't teach an old dogma new tricks. Maybe this will bring the political system to life again, by rejuvenating the opposition and making the public believe that there is actually a difference to vote for.

We bought a house in the late 80s and saw all the craziness of mortgage rates going up to 17 or more %. We even got a fixed rate at around 13% thinking it was going to go up and up, which it did, but then came down to well below what we were fixed at with a lot of time to run to the end of the term. Exciting times. We managed to hang on and have been mortgage free for most of this century. We wouldn't want to go through all that again, or wish it on anyone else. Let us hope that someone has the nous to stabilise the situation before it comes to that or a lot of people who are just hanging on by their eyebrows are going to lose their homes, as they did back then.

Went there, escaped repossession by a narrow margin.

How the, already extended, 3% generation will cope with 7 or 10% is hard to imagine. We went through the 15% ceiling and struggled.

 

[si_c]

This was a conversation Mrs C and I had when purchasing our first house this year, what would the implications of a considerable interest rate rise mean for us. In the short term we've fixed for 5 years, but I'm planning to try and make additional capital repayments over the next couple of years which should reduce the mortgage to a level which will be acceptable even if interest rates rise significantly.

One thing to keep in mind with the current interest rates rise is that whilst incomes have risen since 1992, they haven't risen in line with house prices. The average house price for the UK currently is circa £280k, anyone getting a mortgage now, even with a substantial deposit is likely to be paying more than £2k per month if interest rates rise to 10%, which is more than the median take home wage.

In 1992 the average house price was £55k and the average wage about £14k, so the gap between income and house prices has doubled in the intervening period. This means that any interest rate rises will have a far more acute impact than in 1992.

 

[gbb]

We need to seperate out the political element in this somehow, also, isn't a lot of this News, while its a good subject, i don't neccessarily think it belongs here.
Just my opinion.

 

[a.twiddler]

Our Endowment policy turned out to be mis sold too. Fortunately we did manage to claim back some of it. Probably the number of firms making claims on peoples' behalf became as much of an industry as the original sellers.

I used to have the delusion that building societies originally had their roots in some kind of philanthropic idealism to help ordinary people to buy homes but over the years all this has been dissipated. I have become distrustful of financial institutions full stop. They don't exist for our interest but for their own self interest. This has probably always been the case but it just seems more noticeable today. Each time a round of safeguards is put in place, ingenious people find ways round them.

When it comes to the crunch, you are just as likely to get your house repossessed after missing three mortgage payments today as you were in the 80s or 90s. What is the answer? I really don't know.

 

[jowwy]

We need to seperate out the political element in this somehow, also, isn't a lot of this News, while its a good subject, i don't neccessarily think it belongs here.
Just my opinion.

its also financial matters....so can easily fall into this MONEY MATTERS part of the forum. As long as people refrain from political elements of the conversation.

People discussing mortgage rates and their finances isn't political

 

[Dogtrousers]

On that day I went for a Thai meal in Reading. I remember it, and all the news, quite well. I guess I was financially responsible for paying for the meal after.

 

[gbb]

its also financial matters....so can easily fall into this MONEY MATTERS part of the forum. As long as people refrain from political elements of the conversation.

People discussing mortgage rates and their finances isn't political

Agree, thats why i said, its an interesting conversation but it does need the political element taking out , that's clearly in contravention of the forum rules.

Anyhoo...
When i first started my mortgage, endowment really was the only affordable route. I was aware it had pitfalls but repayment just wasnt affordable so, endowment it was. First annual statement was already telling me i was behind, ditto the next two .
Nah, time to dump it so we went back and renegotiated a repayment.
As it happened (and this might depend on financial markets at that particular time), when we cashed in the endowment, it paid back just about everything we had paid in so we effectively lived rent or mortgage free for three years. To his day, i'm not sure why or how this happened but we were mighty pleased at the time.

I also remember at that time while discussing the new mortgage, ours was very modest £17k, but still a big commitment given my wages at that time. I asked the advisor, how on earth do people manage to deal with 4, 5 times that amount i'm borrowing ? It's scary !!!
Her answer ?
People look at the figures, gulp....and sign anyway