Mortgage Land Prosperity

Archive for September, 2009

50,000 UK homeowners face minimum mortgage increase of £100 a month to secure a new fixed-rate mortgage deal
Wages would have to rise by £2,000 a year to maintain the status quo

A typical homeowner with a £150,000 mortgage would need to see their wages increase by at least £2,000 a year in order to find the extra cash needed to take out a replacement fixed-rate or discounted mortgage deal, according to Expert debt solutions firm Newtomorrow.com.

A quarter of a million UK homeowners will see their two-year fixed-rate mortgages end in the next three months and will find themselves paying at least £100 a month more for a new fixed-rate deal after a sequence of rate rises this year pushed up the cost of borrowing.

In October 2005 the average interest rate on a fixed-rate mortgage was 4.96% – according to figures from the Council of Mortgage Lenders – or around £885 a month on a £150,000 mortgage.

Many current fixed-rate deals are around 5.79% which is around £996 a month – an increase of more than £100. Borrowers with £250,000 and £60,000 mortgages could see rises of around £189 and £40 respectively – significantly more if homeowners revert to lenders’ standard variable rates.