Lenders ‘upping mortgage rates’ despite BoE decision

A number of mortgage lenders have increased their repayment demands, despite the Bank of England’s decision to maintain the base rate of interest earlier this month, it has been revealed.

Louise Cumming, head of mortgages at moneysupermarket.com, notes that the tracker mortgage deals from both Halifax and Abbey, have seen their repayment rates upped over the last week or so.

With many homeowners already finding it difficult to stave off debt management disaster, Ms Cumming warns that lenders could be starting to take interest rate matters in to their own hands.

“The mortgage market seems to have taken a step away from its once controlling hand, the Bank of England, and has the potential to become an untamed beast,” she said.

“Homeowners may have breathed a sigh of relief after last week’s hold on base rates, but it is no longer safe to see this as an indication of stability.”

In March of this year, a report from the Consumer Credit Counselling Service predicted that British homeowners would struggle financially throughout 2007.