Insurance News Archive

UK faces 60% mortgage rate hike

Mortgage repayments for British homeowners could rise by up to 60 per cent, it has been claimed, as borrowers reach the end of their fixed-rate deals.

Around 1.4 million households took out such deals were taken out when interest rates were lower, the Daily Mail reports, with some of these consumers forced to move to a more expensive deal over the next year.

Michael Coogan, director general of the Council of Mortgage Lenders (CML), said: "There is a potential payment shock of anywhere between 30 per cent and 60 per cent for many."

He added that those borrowers who cannot find new fixed or discounted mortgage rates may be able to agree other options with their lender, such as the capping of payments for a set period of time.

The CML today reported a six per cent rise in gross mortgage lending from September to an estimated £32.4 billion in October, which compares to a figure of £30.6 billion for the same month last year.

20 Nov 2007