Mortgage holders 'in for shock'
Three out of four homeowners can expect higher mortgage rates when their fixed-rate deals expire, it has been claimed.
New research by Fool.co.uk found that nine out of ten borrowers are currently on special-rate deals and the vast majority of them can expect less favourable conditions when it comes to renewing their home loans.
The average mortgage rate will jump from 4.8 per cent to 6.3 per cent, the financial website said.
It blamed the ongoing credit crunch for the situation, noting that tightened conditions in global financial markets are having a knock-on effect throughout the UK property market.
Perhaps most revealingly of all, the study revealed that one in 20 owner occupiers are even considering selling up and renting instead - mindful of warnings over a potential house price crash.
"A significant number of homeowners will find that the myriad of choices that were once available has shrunk to no choice, as lenders limit their best deals to their preferred clients," concluded David Kuo, head of personal finance at Fool.co.uk.
The value of the average UK home has risen from £70,696 to £191,556 in the past decade alone.
Published 8th April, 2008
© 2008 Estates IT Limited
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Three out of four homeowners can expect higher mortgage rates when their fixed-rate deals expire, it has been claimed.