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After the shock bank rate rise this month, thousands of homeowners will be looking to remortgage.
Many buyers will be discouraged by expensive mortgages after the news of a third bank rate increase within the last 5 months. This in turn will enable the housing market to have a cooling off period following a year of steady price growth.
Again the worry falls on first-time-buyers, as they will find themselves less able to afford a home of their own.
This months bank rate increase is overall bad news for the would be home buyer.
The situation looks even worse for first time buyers as mortgage interest rates continue to rise throughout 2007.
Here’s a tip for anyone looking for a new deal. Low rate/high fee works best for those with a big mortgage, while those with smaller deals will find the arrangement costs outweigh the benefits. The exception is fees based on a percentage of the loan, i.e. 1.5% of borrowing, which will be more expensive for bigger mortgages.
The good news is that for loans and credit cards the rate increase is less likely to affect the borrowing rate due to the extreme competitiveness in this market.
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