Debtors hampered by “extremely high” fixed rates

Borrowers are neglecting to take out certain mortgages as a result of creditors failing to reduce their fixed rates, it has been suggested.

According to Peter Cowell, mortgage broker at Click n go Mortgages, lenders could be much more supportive of consumers in the current climate but decreases in fixed rates are not being seen and they are “still extremely high”.

Noting that the numbers of first-time buyers would increase should banks pass on money market rates, Mr Cowell further remarked that the drop in demand for fixed-rate mortgages is because “people have got used to the lower tracker rates and the variable rates” and considering the high interest on fixed rates is a big leap.

His comments follow the release of the John Charcol Monthly Mortgage Index, which found that 41.9 per cent of borrowers were opting for fixed rates in August, the lowest the figure has been since December 2008.

By Sarah Adie