This weekend, the new MarketGuard insurance policy was still a prevalent topic , featuring in the Times, the Observer and the Mail on Sunday. Experts agreed that fixed-rates are the best protection from base rate changes, but that the policy could be worth it’s cost, depending on the deal borrowers have.
The Times looked at the soaring cost of arrangement fees, noting that they now average £968; ten times more expensive than in 1992 where a standard fee was around £98. The Sunday Times reported that Britain’s banks are reducing the amount they will lend to borrowers, to take account of rising food and fuel bills. Alliance & Leicester, HBOS and Abbey have all confirmed they will change their lending criteria accordingly.
The Independent on Sunday reported that this month could prove difficult for the 240,000 borrowers about to come to the end of cheap fixed-rate deals. These are made up of people coming to the end of three-year fixes from July 2005, when the average rate was 5.12 per cent, and those nearing the end of two-year fixes taken out when the figure was 5.18 per cent. Those figures now stand at 7.26 and 7.05 per cent, respectively. On a more positive note, the Times noted that fixed and tracker rates are starting to come down and it looks like the start of a recovery. However, the best rates are still reserved for those with lots of equity in their homes and for longer-term rates.