‘Bigger Outlay for Mortgage Holders’ After Rate Hold

Posted 2008-01-3

Mortgage borrowers could face paying out more after The Bank of England decided to hold the base rate this month, says one broker.

Ray Boulger of John Charchol said homeowners could end up paying £105 more in interest than they would have if the Bank had announced a 0.25 per cent cut.

Mr Boulger added a rate cut this month was expected among industry experts and would have been seen as justified. He also said other “negative economic statistics” released this month suggested a rate slash was likely.

The expert also pointed out factors such as npower’s decision to initiate a 17 per cent price hike could spell more cash problems for Britons.

However, he also said consumer price index inflation is only just above the central two per cent target, with global economic slowdown likely to ease it down.

Mr Boulger said: “If the monetary policy committee delays the next cut too long the Bank rate may have to fall further than would have been the case with an earlier cut.”

More homeowners could end up opting for secured loans this year, according to moneysupermarket.com.

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