06-09-2007
Fixed-rate borrowers should choose a mortgage carefully
Those coming to the end of their fixed-rate mortgage deals should chose their replacement mortgage carefully, it has been claimed.
According to Nationwide Building Society, borrowers with fixed-rate mortgages who will come to the end of their fixed period between October and December could find themselves facing interest rates of approximately 7.75 per cent for a standard variable rate product if no action is taken.
"For some borrowers it will come as a quite a fright to see their mortgage payments increase dramatically," said Matthew Carter, director of mortgages at Nationwide Building Society.
"To absorb some of this shock, borrowers need to consider re-mortgaging as soon as their deal ends, or beforehand if their lender allows it," he added.
Indeed, since the latter months of 2005, fixed-rate mortgage interest rates have increased from a rate of 4.56 per cent to approximately 6.41 per cent.
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