Interest rates in the 70s

We had one income, two small children, no car, no telephone and a broken gas water heater. Mum came to the rescue and bought us a new boiler. There was the fear of a nuclear war. I made most of the children’s clothes.

It was a real struggle to keep going but we did it. DH finally got another job with pay increase and car and life became easier. We could finally afford a holiday and a telephone.

This current situation feels pretty similar to me. A relatively fixed income and worries about keeping DH warm. We may have to use DH’s Attendance Allowance to keep him warm.

For so many on small incomes this is a nightmare and government help will be swallowed up in NI rises, food price rises and fuel bills.

16% mortgage rate and dreaded letters coming from the bank to say our mortgage payments were increasing. I remember being in tears quite a bit, wondering if the rates were ever going to stop rising. No holidays, no meals out and a takeaway was a treat/special occasion. I wont be popular but cannot understand people dreading the fuel price rises but can afford £3000 dogs and big cars. Multiple holidays abroad too. I often wonder how do folk afford it all.

Grannybags

I can't help wondering what it would have been like to have savings back then when the rates were so high rather than a crippling mortgage.

We'd be rich!

I've no idea! ?

I can't help wondering what it would have been like to have savings back then when the rates were so high rather than a crippling mortgage.

We'd be rich!

We sold our flat in North London in 1982 and bought a house in a cheaper East London area and still went from a £12,000 to an £18,000 mortgage. When we moved I was pregnant and when I left work six months later we lost 50% of our income, as we both earned the same. I remember the swingeing interest rates very well. I wore OH's boxer shorts and T shirts as I got bigger as I couldn't afford new clothes!

Very worrying times, but today's generation have different but similar worrying problems, I think.

I remember the 80’s and eye watering interest rates. Had a mortgage on my first house

I was in a good job, paying good money but a case of mortgage was paid come what may and everything else stopped i.e. no going out, no treats, if something broke, it stayed broke until money was available

As people up thread have mentioned, Boomers, which I am one, had things handed to them on a silver platter ?

We did! ??

It was not fun with interest rates that high believe me

I feel sorry for youngsters with high mortgages, hanging on by their finger nails and interest rates going up

It is all relative in some senses, all the younger generation are going through or will be going through is what us Boomers went through in the 80’s

In 12 - 18 months time, I foresee a lot of repossessions as those nice men who lent money to buy houses, at low interest rates, pass it over to others to get their money that is owed to them as payments can’t be kept up ?

This is what happened to some Boomers in the 80’s and it was not nice

In 2024, we have a GE, now that is going to be interesting ??

My sewing machine and knitting needles helped me clothe the children, it was cheaper then to do that but no longer.
Not that they want Granny's home-mades.

I think our mortgage went up to about 15%. The building society extended the mortgage from 25 to 40 years so we didn't have to pay any extra. Our house had cost £9,000 and we were able to live reasonably on my husband's wages as a builder. We had a telephone and a car (of sorts!) obviously no holidays, but we were living in Cornwall and the beach was 20 minutes away. I don't think many couples can manage on one average salary these days.

To make sense of interest rates on mortgages, this link plots as a graph and a table interest rate changes from 1975 to date.
www.propertyinvestmentproject.co.uk/property-statistics/uk-interest-rate-history-graph/.

We bought our first house in 1969 and during negotiations the mortgage rate went up from roughly 6.5 % to 7.0% and didn' get that low again until the end of 1992, 23 years later.

Like others we went through all the ups and downs. Fortunately I went back to work part time in 1978 and full time in 1983 so my salary came into play at the worst times, but I can remember that very nearly half DH's salary was going out mortgage payments each month,at one time

16.67 was the highest my mortgage went to. Felt as though it was branded on my forehead. Horrible time financially.

I remember those days too. though I don't want to.
Legal battles with 1st husband over family home. What a nightmare.

GrannySomerset

We moved from the north to the south west in 1983 and our new house cost twice what we got for the old one. Interest rates at 15% soon after kept us hard up for years, and our warnings to our children to allow for interest rate rises have been met with kind smiles. Low interest rates mean they have just about paid off their mortgages so which generation has been luckier, would you say?

Not the boomers! Two of my DC managed to buy a family home whilst keeping the 2 bed semi they already had. So they have a rental property and the large family home they live in. They would never have been able to do that without rock bottom interest rates. Of course they have good jobs and have both worked hard. We did too. They have not wasted cash, but have had some nice holidays. Not camping in a 3rd hand tent on the east coast like we had to.

My entire monthly salary paid the 15% interest rate on our £18000 mortgage. The house cost £38,000 but it was London.

I remember the roof had a small leak and until we could afford to get it repaired there was a bucket to catch the drips. I can smile now but it was no laughing matter then.

Woow! I really was expecting a lot of misunderstanding so thanks all!
I can remember when my husband was able to get a mortgage paying 5% once he worked for the bank which was then a good mortgage.
I will really be surprised if a mass of people complain on this matter
Cath9

Dottygran59

Oh I remember this so well - we seemed to get a letter every month from the building society telling us it was going up again - how did we manage? It was indeed terrifying

You’re quite right about the letters. We’ve done a huge declutter of our house and I came across a file of old mortgage papers. There really were letters from the building society each month to tell us that the rate had gone up yet again.

When the rates went up to 15% I remember just laughing ironically because I realised that we would be far from alone if we couldn’t afford payments any more and I figured they couldn’t make everyone homeless.

We did muddle through but it was a difficult time for us, as it was for so many others.

Ladyleftfieldlover

When we bought our first house in the 70s, the interest rates were 15% - basically all the money I earned paid the mortgage - fortunately by the time I gave up work to have our first baby, rates had reduced a little and maternity pay back then was pretty good. Everyone got child benefit back then too. At some point during those times we were overdrawn three weeks out of four!

Our first house was bought in 1979 just after rates increased to 15%. To put things in perspective, it’s the norm to be driving round in a car which cost more now than our first home back then.

Cath9

I expect I won't be popular when saying that all this moan ing about the interest rates going up when in the 70s does anyone remember when it was as high as 9% and even went up to 13%?

I remember not long after Margaret Thatcher was elected in 1979. We had just got married and the mortgage rate shot up from 9% to 15%. It added massively to our monthly payments right at the start and we thought we wouldn’t survive.

I got a job as a childminder with a kid same age as our first to make ends meet.

We never ate out, had no holidays and sold the car to raise a few hundred pounds. My daughter's baby clothes and pram were all 2nd hand. There was no way we could have afforded disposable nappies. Yet we survived...... Phew!

It was terrifying and my ADC really don't get it. It was impossible to budget. The announcement of a rate increase was followed almost immediately with a letter from the bank upping the repayments. We had 3 young DC and nothing spare. We lived rural so needed a car. We lived in dread of a punctured tyre or the clutch going. DH spent many a weekend trying to keep our old banger on the road. We also cut down on food. We went veggie for half the week through necessity not choice. I did 'outwork' from a local factory. I often sat working until 2 am. I was paid a pittance.

I remember in 1981 and 1982 when it was 16%! We didn't eat out, we took a picnic and we never went out in an evening!

I was a single parent, when the rate was 15%. This was early 80's, how I managed I will never know!

When we bought our first house in the 70s, the interest rates were 15% - basically all the money I earned paid the mortgage - fortunately by the time I gave up work to have our first baby, rates had reduced a little and maternity pay back then was pretty good. Everyone got child benefit back then too. At some point during those times we were overdrawn three weeks out of four!

I also remember the rate climbing to 15%, it was very scary, I think it was in the 1980s. I also remember galloping inflation in the early 70s and I think Harold Wilson was the Prime Minister, every so often everybody was given a pay rise of 50p a week.

Doodledog
We were having the ‘boomers don’t know they were born’ conversation only this week with some of our younger colleagues.
Yes of course they too have their problems, but to think we had everything handed to us on a plate is crazy.
When I think now what an enormous amount £7000 seemed, I could pop it on a credit card now.