Prepare for a sharp mortgage rate rise as eurozone crisis intensifies.
Further mortgage rate rise announcements are expected if the eurozone crisis continues to escalate according to the Bank of England. Home-owners are being warned to prepare themselves for sharp increases.
High street lenders are driving up mortgage costs in an effort to restore profit margins. Continued mortgage rate rise announcements will come as yet another blow to UK mortgage holders already under financial pressure.
The fear is higher mortgage rates could mean many home-owners having to find hundreds and in some cases thousands of extra pounds per year, which could push some 'over the edge’ resulting in the loss of their home.
The BoE has commented saying that the eurozone crisis is hitting home-owners hard. Since banks funding costs have soared funding increases are being passing onto customers, many of whom already find it a struggle to make their current monthly mortgage repayments.
Una Farrell of the Consumer Credit Counselling Service has warned that for many, the difference between meeting monthly mortgage repayments and falling into mortgage arrears is not great. For some even a small increase will be too much as currently 1 in 10 home-owners are already in some form of mortgage distress.
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