View more on these topics

One in two homeowners will remortgage after 1% rise in base rate

One in two homeowners say they would remortgage when rates rose by 1%, says The MarketPlace at Bradford & Bingley.

Research carried out by The MarketPlace in October last year found that one in two homeowners would only consider remortgaging if rates were to rise by 1%. Since then, rates have risen from their historic low of 3.5% to today&#39s figure of 4.5%.

The MarketPlace says with yesterday&#39s base rate rise, the fourth in eight months, now is the time to lower the cost of borrowing and warns that a wait and see attitude could cost borrowers £2.5bn.

Elliot Nathan, mortgage development manager for The MarketPlace, says: “With further rises expected in the coming months now really is the time for borrowers to act. Our research revealed that apathy would rule until rates rose by 1% and we are now there. Although people should not be overly concerned as the base rate is still, in historic terms, low, the recent rises do provide them with a reason to look at lowering the cost of their borrowing.

“Borrowers with a £100,000 variable rate mortgage will have seen their monthly payments rise by approximately £60 a month in the last eight months, but many can easily do something to cut this cost.”

The research also showed that nearly two-thirds of homeowners would not be concerned about increases in their mortgage repayments until they had risen by over £50 a month. The MarketPlace says with many monthly mortgage payments now breaking this barrier, it provides even more incentive to remortgage.

Recommended

Platform sheds sub-prime image

A boom in buy-to-let and self-cert is changing Platform&#39s traditional reputation as a sub-prime lender. Following Platform Home Loans&#39s merger with buy-to-let and self-cert lender Verso in Febuary last year, applications have boomed from £800m to £3bn completions a year. Although 45% of the total business is still sub-prime, buy-to-let and self-cert now form 30% […]

Lib Dems say new consumer credit laws long overdue

The Liberal Democrats have responded to the new consumer credit laws for lenders, saying the legislation is long overdue. The rules are designed to make credit agreements and loan adverts clearer. Liberal Democrat shadow secretary of state for trade and industry Malcolm Bruce says: “The blunt truth is credit companies have led the public by […]

Official clarification on PII

From Eleanor LintoI write to clarify a point in the article &#39How you can avoid a PI headache&#39 (Mortgage Strategy May 24). Our final rules set out the minimum levels of indemnity for insurance and mortgage mediation activities respectively. For a firm carrying on insurance mediation this is e1m for a single claim and in […]

Countrywide to set up UK lender

Countrywide Home Loans, the largest independent originator of mortgages in the US, is planning to launch a sub-prime lender in the UK. A source at the US-based lender tells Mortgage Strategy: “We&#39re definitely launching into the UK and we&#39re definitely launching into the sub-prime market.” Loans will be funded through warehouse lines and then securitised […]

China tech and Global Alpha: a new great leap forward

By Robin Geffen, Fund Manager and CEO

Internet giant Alibaba is exactly the type of entrepreneurial company that the high-conviction, top-performing Neptune Global Alpha Fund seeks to invest in. Established just 14 years ago in an apartment in Hangzhou, today Alibaba is larger than Amazon and eBay put together and is challenging some of the most powerful internet companies in the world…

Read more 


Important information

Investment risks

The value of an investment and any income from it can fall as well as rise and you may not get back the amount originally invested. Forecasts and past performance are not a guide to future performance. Some information and statistical data herein has been obtained from sources we believe to be reliable but in no way are warranted by us as to their accuracy or completeness. These are Neptune’s views and as such this document is deemed to be impartial research. We do not undertake to advise you of any change to our views.

Newsletter

News and expert analysis straight to your inbox

Sign up