Higher mortgage costs for first time buyers

14-Sep-2007

First time buyers are facing up to higher mortgage costs after major lenders raised their rates in response to the US sub-prime crisis.

Both Halifax and Abbey have said they are to raise rates on some tracker mortgage products by between 0.1 per cent and 0.2 per cent for new borrowers, with others expected to follow suit.

Northern Rock, meanwhile, has had to seek emergency funding from the Bank of England in order to provide for further lending, though analysts have said that the bank's customers are not at risk.

However, Abbey has today announced that it is to cut its fixed-rate mortgage rates by between 0.05 per cent and 0.21 per cent.

"We are committed to ensuring that Abbey's fixed rate mortgages continue to be among the most competitive rates in the market," commented Nici Audhlam-Gardiner from Abbey.

"Two-year fixed rate products are the most popular products in the Abbey range," Ms Audhlam-Gardiner added.

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