Fixed rate mortgages now ending – Are you facing a more expensive future?

January 20th, 2008

Fixed rate mortgages now ending – Are you facing a more expensive future?

Approximately 250,000 fixed rate mortgage deals are now coming to an end after their 2 year period. Since they have been take out the interest rate in the UK has risen 5 times. In October 2005 the base rate was 4.96% and now it is 5.25%! This means that many people are facing an increase of at least of £100 than they currently pay. So what does this mean for the market or the individual? Well a typical owner with a fixed mortgage of £150,000 will need to see their salary increase by at least £2000 per year to cover the difference according to Net Tomorrow.

So what should you do? The main thing is not to panic. Take time to look through lots of lenders to see what the best deal is for you. If you are nervous about the current state of the market then perhaps another fixed mortgage is the deal for you. If you are encouraged by the recent drop of 0.25% in the base rate then perhaps a variable or a tracker is the better solution. The main thing is that if your fixed rate mortgages is coming to an end then consider the implications now and budget for what you can afford

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