Mortgage customers to face ‘significant’ repayments rise
Borrowers coming to the end of their fixed-rate products could be set to find the costs of their secured and home loan repayments increased, a new study reveals.
According to research conducted by Mortgage Advice Bureau, those who took out a two-year fixed-rate mortgage during the second quarter of 2005 may find their monthly bill rising by up to a third if they switch to a standard variable rate product when their current deal expires.
Meanwhile, arrangement fees for current loans are reported to account for £1,000, which in turn could effectively increase some borrowers’ monthly mortgage repayments by a quarter.
Managing director of Mortgage Force Rob Clifford said: "The payment shock for some people will be significant.
"Not many people can afford a monthly cost rise of 25 per cent."
Last month, Dr John Bone, sociology lecturer at the University of Aberdeen, claimed that rising mortgage costs are causing a rising number of homeowners to act "like bonded labourers because they are so heavily indebted".
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