surviving the recession

It’s been noticable that in the last month or two, the share indexes have been rising off their lows. The stock markets famously predict what the real world economy does, falling before a recession takes hold and then rising in anticipation of what the real economy will do.

It’s also now clear that the real world economy is showing signs of stabalisation and that we might pull out of recession by the end of this year. So now could be a good time to buy shares. As always, choose the best stockbroker who will charge a low amount per share deal and be sure to research shares thoroughly before you buy.

So called “green shoots” seem to be sprouting all over the economy. Confidence is a little better than it was and certain indicators are ticking up, eg services output - not back to growth levels to be sure, but better than before.

All of this means that we have started the long climb back to normality, and that means inevitably that interest rates will have to start rising again.

By my reckoning, interest rates will start rising at the start of next year (though if the economy responds faster to the mdicine than expected, we should see rate rises at the end of this year). That means we have at most six months to make the most of the current low rate regime.

My advice is to use current conditions to pay down your mortgage as far as possible and to keep a sharp eye out for remortgage deals. Remortgage deals have been poor in the last six months, but the best deals are reserved for those with a spotless credit record and who have a low loan to value borrowing requirement. Therefore do ensure you meet all your credit obligations on time, pay all your bills on time and pay down your existing mortgage if you can to get the loan-to-value down.

Once you have spotted a decent deal (fixed rate of circa 2.5%), and qualify on all criteria, go for it.