A gloomy outlook prevailed in the weekend financial press, with the increased cost of borrowing and ‘credit crunch’ still dominant topics.
The Times reported that there is more pain for borrowers, as mortgage rates will continue to rise in the coming months. As noted in the Observer, market swap rates- which mortgage companies use to decide the price of fixed-rate mortgages-rose to their highest level for almost a year last week, on the back of gloomy inflation figures. This is likely to push up the cost of two, three and five-year fixed-rate mortgages in the days ahead, experts warn.
In light of increased rates and market instability, the Sunday Times, Financial Times and Independent on Sunday all looked at the benefits of fixed rates. Experts are certain they will increase in popularity over the coming weeks, as worried homeowners seek stability.
Elsewhere, the Mail on Sunday reported that the average fee has risen by 66 per cent- from £520 in September 2006 to £860 now. In addition, the number of fixed-rate loans with arrangement fees of more than £750 has rocketed by about 1,000 per cent in the past 18 months. Finally, the Sunday Telegraph investigated negative equity and looked at what steps those affected can take to alleviate the pain.