There was a comprehensive range of mortgage-related articles in the weekend press, ranging from interest rate cuts to lender’s credit crunch profits.
The Financial Times looked at the incentives that house builders have introduced to attract buyers in a falling market. Popular offers include mortgage subsidies of £500 a month for two years and paid stamp duty and legal fees. The paper also reported that Northern Rock, HBOS and the Royal Bank of Scotland last week became the latest lenders to cut rates, in a further sign the market is improving for borrowers. The Independent on Sunday also looked at some of the better mortgage rate cuts, noting that an element of competition was back in the market and that potential borrowers should act fast if they want one of the better deals.
In contrast, the Observer suggested that homeowners coming to the end of fixed-rate deals might be better off staying on their existing lender’s standard variable rate and playing a game of ‘wait and see’. The Mail on Sunday said that many homeowners who need to borrow 90 per cent or more of their property’s value will have no choice but to pay their lender’s standard variable rate, which could be as high as 7.5per cent.
Finally, the Sunday Times had an article explaining how lenders are cashing in on the credit crunch, despite wholesale funding costs returning to pre-credit crunch levels last month. Banks and building societies now charge an average margin of 0.78 percentage points above swaps and 0.83 above Libor rates