The announcement by the Bank of England that the interest base-rate rise is set to rise to 5.75% will not be well received by millions of homeowners across the country. The number of people with credit card debt and personal loans has never been higher and the latest interest rate rise is going to put people's already strained finances under increasing pressure. In fact, recent reports suggest that already, 1.2million utility bill payments are being missed every month because homeowners cannot afford all the bills and credit they have committed themselves to.
The latest interest rate rises now mean that a typical £125,000 is now £130 more expensive than a year ago. In fact, it is reckoned that as much as 44% of a family's income is now being swallowed up by mortgage costs. So it's fair to say that if interest rates continue to rise at this pace, homeowners really could find themselves struggling to make their repayments in the future.
In the back of everyone's mind is that interest rates will rise as high as they did in the 1990s (as high as 19% in some cases), which is why more and more of us are looking for secure ways to protect our remortgage payments in case they do increase.
Information furnished in above lines definitely given some short of tension to your remortgage dreams if residing in UK. Need not to worry as solution lies in Fixed rate mortgages as they are the perfect way to protect you against the current period of rising interest rates. Put simply, these types of mortgages are set at a specific interest rate for a number of years which can't be changed for the period of the mortgage. This means you know exactly what to budget for every month until the mortgage term finishes.
A word About Fixed Rate Mortgage
A fixed rate mortgage makes it easy to plan ahead, because as the name suggests, the interest rate on your mortgage stays fixed.
This means that as a fixed rate mortgage customer, even if the Bank of England Base Rate or our standard variable rate changes, the interest rate on your mortgage remains constant over a fixed period of time. This makes your budgeting easier, because you can plan ahead knowing exactly how much your monthly repayments will be.
Benefits of Fixed Rate Mortgage
Fixed rate mortgages can be good for first time buyers and anyone on a budget who needs the stability of a set monthly repayment. With a variable rate mortgage your payments may go up and down according to the Bank of England Base Rate. However with a fixed rate mortgage you have the security of knowing the exact amount you will repay each month, despite any changes in interest rates.
Having a UK fixed rate mortgage means the interest rate depending upon the fixed rate products available at the time, you will pay is set for a specified period. You can fix the rate for up to five years, however you may prefer to fix for two or three years. Once the fixed rate period is at an end, your repayments will revert to our standard variable rate. Come and explore more about the concept of fixed rate mortgaging in company of instantmortgageuk.com expertise.
Resource: Cash Back Mortgage| Fixed Rate Mortgage|Second Mortgage