| Remortgage
and mortgage rates have had low interest rates for some time
now.
The low
rates can in part be attributed to the fact that The Bank
Of England Base Lending Rate was reduced to also an all time
historic rate of half of one percent, which had a knock on
affect on mortgage and remortgage rates.
Tracker
products do exactly as they say, and that is they follow or
track the base lending rate, and when this rate is low, so
are mortgage products
.
There
are also variable mortgages, that as their name also suggests,
can vary depending, not only on the base rate, but to some
extent on the whim of the lender.
Mortgage
providers can alter the rate to suit themselves to a certain
extent.
Therefore
both tracker and variable repayments can alter, and rise at
any time, but over the past few years, interest rates remained
low and very stable.
Mortgages
are the finance required to buy a home, and buying a home
would, in normal circumstances and times, be an attractive
proposition, when rates are low.
However,
many would be property buyers were put off by the fall in
house prices during the recession, and preferred to stay put
as it were.
Mortgages
tumbled as a result, as did remortgages for the same reason.
At the
end of a mortgage tie in period, during which there would
be an early repayment penalty of up to 5% of the outstanding
balance, many homeowners used to arrange a remortgage, which
is a mortgage with a different lender.
Sometimes
a remortgage is only for the same amount and a lower interest
rate is obtained. At other times a homeowner borrows more,
and uses the funds for a variety of purposes.
Debt consolidation
can save a fortune every month when a remortgage is used as
debt consolidation loans that pay off high interest debts
in credit cards, etc.one low repayment is all that remains.
Secured
loans have the same uses as remortgages, and are loans that
are secured on the equity of property.
There
was a decline in secured loan approvals for the same reasons
as remortgage had declined. In addition criteria tightened.
Many people,
who were eligible for remortgages and secured loans in the
last two or three years, when rates were low, may now be sorry
that they did not apply at that point as rates look like thay
are going up, with the Abbey already announcing an increase
in interest rates.
Secured
loans may go down the same road.
|
