What the papers say - 16th and 17th August 2008

What the papers say - 16th and 17th August 2008

Student finance was the crucial topic in the weekend money pages but there was still room for a few mortgage-related articles. The Sunday Times provided extensive coverage on university money matters, including advice on the best towns in which to invest in a buy-to-let student property. Student lets were one of the strongest performing areas in residential property last year and could bring returns of more than 10% if investors pick the towns that produce the best rental yield.

Elsewhere, the Financial Times reported that tough times are expected to continue for lenders as they scale back maximum loan-to-value ratios, load higher premiums on to riskier business and price mortgages to bring in profit, not just market share. It was also noted that the average arrangement fee is now double what it was in 2006, despite recent interest rate reductions.

The Times looked at the recent rate cuts from Northern Rock, which has cut the cost of its two-year fixed-rates in a bid to attract lower risk mortgage business. The Independent on Sunday also noted that Halifax will trim at least 0.25% off some of its fixed and tracker rates this week, and in some instances rates will fall by as much as 0.45%. Experts warned however that these rates may still be limited to borrowers with a good deposit. Finally, the Sunday Express suggested that a tracker rate is currently the best option as experts expect UK interest rates to fall next year.

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