1 in 5 unsure about mortgage rates after base rate rise
1 in 5 unsure about mortgage rates after base rate rise
A poll released by unbiased.co.uk has found that 22% of homeowners don't know what will happen to their mortgage repayments if the base rate were to rise, as expected. The poll results show that 13% of home owners with a tracker and 16% of those on a standard variable rate mortgage were not sure what effect a base rate increase would have on their monthly outgoings.
Chief Executive of unbiased.co.uk, Karen Barrett, commented:
"Predictions of when the base rate will increase are drawing ever closer, but when it happens it will still come as a surprise to many homeowners. The base rate increase is inevitable and so when this happens homeowners need to ensure they are prepared for what this increase will mean for their personal finances. Those on tracker rates, standard variable rates and even fixed rates are in the dark about how their personal finances will be affected by this change, meaning it's impossible for them to budget for the future."
At the same time as providing contractors with independent mortgage advice we also provide a holistic financial review, this will allow you to ask any questions regarding rate rises and monthly repayments so you can be fully assured of any changes if the base rate does go up. That is why we pride ourselves on contractor mortgage advice.
In other news, an early redemption charge free loan has been offered by Brilliant in conjunction with Newcastle building society. This would allow early switching without paying an extra fee.
"The Early Redemption Charge-free loan is offered at 4.64%, or 4.29% with an ERC"
Stated the Managing director of Brilliant Solutions, Matthew Arena, who went on to say:
"I think the two year fixed rate with no ERC will be very popular, particularly at this time when there is so much uncertainty about where base rates are going to end up. A no ERC fixed rate provides a level of flexibility which gives clients a safe haven but they are not tied if rates do not actually increase,"
Intermediary services executive at Newcastle Building Society, Steven Marks, commented:
"We believe in developing products that the marketplace wants and our no-ERC is a prime example of this. More and more customers require flexibility with their mortgage product, given the low interest rates and competition in the marketplace, which was one of the main reasons we introduced this product."
This is an interesting development in the mortgage marketplace but ultimately these products aren't contractor friendly. If they do prove successful, however, we may get contractor mortgage products that are similar.