Remortgaging rates set to worry first time buyers

08-Jun-2007

First time buyers looking to break into the housing market have been giving a warning by a new study indicating that remortgaging rose by ten per cent last month.

Research from Spicerhaart Financial Services found that remortgaging increased from 18 per cent of the market in April to 28 per cent last month.

Fixed-rate deals remained the most popular due to uncertainty over future rate rises, the study advised.

"Rising interest rates have pushed up mortgage repayments and put a strain on consumer finances. This has resulted in a substantial rise in the proportion of borrowers choosing to remortgage their property to secure future monthly outgoings," advised Spicerhaart operations director Steve Cox.

"Borrowers whose fixed rate deals were coming to an end also contributed to the increase in remortgaging, as they looked to secure a last minute short term fixed rate deal to protect themselves against further interest rate rises," he added.

Such problems could get worse if the Bank decides to raise interest rates, already at a six year high, to 5.75 per cent in July.

To find out about those mortgages specifically aimed at first time buyers, see our best buys for first time buyers table.

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