The Daily Mail bid farewell to the 0% mortgage this week, as best-selling tracker deals taken out 2 years ago come to an end. Lenders such as Halifax offered rates running as low as 0.51% below base rate and many borrowers have benefited hugely over the last year, however they now face a hike in their monthly payments when they revert to Standard Variable Rate or look to remortgage. This is not helped by the fact that, despite lending rates plummeting to a record low of 0.57%, lenders are reluctant to pass these cuts on, and the typical SVR is now 3.50%. Some experts argue that interest rates have to stay high to account for the increased risk of default during a time of high unemployment. This does not help the continued plight of the First Time Buyer however, and the Daily Express reported on new figures showing that borrowers with only a 10% deposit have seen a drop of just 0.12% in mortgage rates over the last 2 years, compared to 1.86% for those with a 40% deposit, and an overall 4.35% drop in the cost of funding. For those considering alternative ways of getting onto that elusive property ladder, the Daily Telegraph looked at Shared Ownership and Shared Equity schemes. Experts advised that anyone interested in these schemes needs to do their homework first, as not all lenders support these schemes, or will require a larger deposit. In savings news the Mail discussed the continuing confusion surrounding the imminent changes to the Isa cash allowance for the over 50’s, and in particular which lenders will allow top ups to existing fixed rate Isas. This follows news that Halifax has told some customers they will lose their additional allowance, however the Lloyds Banking Group, of which Halifax is a part, have confirmed that they will accept top ups.
What the papers say- 22nd – 23rd September 2009