Experts in this weekend’s financial press urged homeowners with variable rate mortgages to switch deals now, before a combination of rising interest rates and falling house prices dramatically increases the cost of changing. The Sunday Times reported that 5 year swap rates hit 2.87% last week, their highest since last May, and several lenders responded by repricing. Experts suggested that any drop in house prices could have a serious impact on available fixed rate deals, and with the facility to book a rate up to 6 months in advance, the Financial Times recommended acting before it is too late. Quite how much interest rates will rise is a matter of much debate, and the Guardian looked at mix and match mortgages as a good way for borrowers to secure their finances without transferring their whole loan from a low variable rate to a more expensive fixed rate. Experts in the Sunday Express also discussed the benefits of offset deals at a time when savings accounts are paying such low interest and the margin between offset and traditional deals has narrowed. Elsewhere the Mail on Sunday revealed that a competitive UK market means that the cost of life cover here is the lowest in the world, yet research by Aviva shows that a shocking 39% of adults – around 20 million people – have no form of financial protection whatsoever.
What the papers say- 15th and 16th January 2011