Mortgage holders 'starting to worry about rate increases'

Date:Wednesday 1st July 2009
Author: Susanna Kavka

Homeowners in the UK are beginning to worry about potential increases in mortgage repayments, an expert has claimed.

According to Michelle Slade, a spokesperson for Moneyfacts, consumers are predicting increases in the base rate of interest.

If and when this happens, mortgages will go up in cost.

She said: "Homeowners are starting to worry about the effects any base rate increase will have - so much so that the demand for fixed-rate mortgages has started to increase."

Ms Slade went on to recommend that homeowners protect themselves from future rate rises by securing such fixed-rate products.

Although the costs of fixed-rate mortgages are higher than standard rates, they enable homeowners to budget on a more long-term basis, she said.

According to figures produced by Halifax, the average mortgage rate in Britain stood at 3.62 per cent in April this year.

This was a fall of 47 per cent compared with 12 months earlier.