Borrowers are turning away from fixed-rate mortgages because they think they are too expensive, it has been suggested.
Responding to figures from John Charcol revealing that such products declined in popularity in September – with variable rates covering almost two-thirds of the market – Ray Boulger of the company observed that “most fixed rates still look too expensive”.
It emerged that 34.3 per cent of debtors opted for fixed rates during that month – constituting the smallest proportion for the year – but Mr Boulger noted that the best rates in the market “have got cheaper â€¦ with some real competition” being seen in some sectors.
He went on to say that the majority of John Charcol’s clients have been advised to choose variable rate mortgages.
In related news, the British Bankers’ Association recently indicated that mortgage lending is increasing among the main high street banks, with the number of loans being approved reflecting levels last seen in 2007.
By Sarah Adie