The credit crunch ‘honeymoon’ is over for homebuyers as lenders continue to increase mortgage interest rates while reducing the choice of loans.
After the banking crisis of 2007 and 2008, rates plunged to record lows – a lifesaver for borrowers with no equity and where household incomes were squeezed.
Banks also held off repossessing homes, even where borrowers were late with payments, in what was called ‘forbearance’.
Careful planners: Phil and Abbie Monkhouse with Oliver, 2, switched deals
Not only have Halifax, Bank of Ireland, the Co-op and other lenders increased standard variable rates, but the cost of the average two-year fix has gone up by almost ten per cent since last October.
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