View more on these topics

John Charcol warns of £43 million monthly debt for SVR homeowners

According to broker John Charcol, the quarter of all homeowners who are still stuck on their lender’s SVR will be landed with a bill of £43 million extra each month, if the predicted increase in interest rates goes through.

Borrowers who are paying their lender’s SVR are already at a disadvantage, paying an average of over £100 more each month than they need to compared to those who are on the market leading deals.

Ray Boulger, senior technical manager at John Charcol, says: “While an interest rate rise is never good news for homeowners, those who are still on their lender’s SVR will be hit particularly hard.

“The vast majority of lenders will pass the Bank Rate increase on in full and some will no doubt increase their SVR by more. To the average householder on an SVR repayment mortgage a bank rate increase will mean £15 more per month, adding up to £180 a year.”

Recent weeks have also seen many lenders withdraw their market leading fixed rate deals as the cost of funds increased in anticipation of the Bank Rate rise. The withdrawal of these deals comes as a further blow to borrowers who want to protect themselves from any further interest rate rises by fixing their repayments.

Boulger says: “It’s absolutely vital that homeowners don’t languish on their SVR and seek advice on getting the right mortgage to suit their needs.

“With interest rates hotly tipped to increase not just once, but possibly twice in the next few months, all borrowers need to ensure that they are on the best rate possible, especially if they do not have a fixed rate mortgage.”

Recommended

Marketingbrief

Support is critical in the mortgage industry. Kevin Paterson’s A-Z review rates the marketing material that lenders issue to help brokers with sales and business development

Mortgages PLC appoints marketing manager

Mortgages PLC has appointed Kirsteen Gibb to the newly created role of marketing communications manager.Gibb is responsible for managing all aspects the lender’s brand communications activity including advertising, marketing materials and events. Based in Glasgow, she reports to head of marketing, Julian Wells. Previously marketing communications consultant with Norwich Union International, Gibb has relocated from […]

Market prices Research from Halifax Estate Agents shows that 73% of market towns have higher average house prices than neighbouring towns in the same county.

Lenders have defended ex-tended early repayment charges following criticism from Hamptons Mortgages. The brokerage has de-nounced lenders that offer low initial rates accompanied by heavy ERCs for borrowers who apply for an extended period following the initial rate deal. It claims that this type of hangover rate is considerably worse value than other deals without […]

NHER launches training programme for energy assessors

The National Home Energy Rating scheme has launched a new training and assessment programme to ensure that there will be enough qualified energy assessors in time for June 2007.The programme will ensure that government plans to introduce Energy Performance Certificates next June will definitely happen.NHER’s domestic energy assessor programme includes eight days of intensive training […]

Newsletter

News and expert analysis straight to your inbox

Sign up