Bad Credit Mortgage Rate

Borrowers warned not to rush in wake of interest rate hike

Leading mortgage lenders have warned against the temptation of fixed rate deals, in the wake of the Bank of England's interest rate rises.

Those seeking bad credit mortgages or lifetime mortgages might opt for a deal where interest rates were guaranteed to remain the same over time. This is as opposed to a tracker mortgage, which would correspond to changes in base rate as governed by the Bank of England.

Interest rates went up to 4.75 per cent last Thursday, but Ray Boulger, spokesman for independent mortgage provider Charcoal, told Reuters that this it was not necessarily a good idea to go for a fixed rate loan: "If base rates are going to go above five percent and stick there for a while, then it makes sense to take a fixed mortgage.

"But if it is not going to go over five percent, and I don't think it will, then a tracker mortgage makes far more sense," he continued.

Not paying mortgage will result in kind of attention you don’t ...

Q: Ive had a home-equity loan for eight years. Six months ago, I called the mortgageservicing company to ask for the payoff. The toll-free number on my bill wasnt working, so I decided to stop paying on the loan to force them to contact me. Still, no one has called. What should I do? A: When you stop paying a mortgage, several bad things happen fairly quickly: You trash your credit history and credit score, late penalties and fees are tacked on, and you can trigger "universal default" on your credit cards. If youre carrying creditcard debt, your interest rate could skyrocket. No one is going to call you back from this mortgage-servicing company until its too late. The next call you get will be from the foreclosure department, telling you that it is starting foreclosure proceedings. Or you might not even get this call.

Mortgage lending reaches new high

New figures show that gross mortgage lending rose to a new record high of £32.2 billion last month, up from £25.7 billion in June last year. The Council of Mortgage Lenders (CML) statistics demonstrate strong consumer demand for the whole range of homeowner loans, including bad credit mortgages and lifetime mortgages. May had also been a record month for the market, with gross mortgage lending reaching £29.1 billion. The 11 per cent monthly rise in June was widely expected because it is traditionally the month when the financial aspect of spring buying activity kicks in. "Today's figure reflects the seasonal rise in house buying, strong house price growth and high levels of remortgaging activity," said the CML's director general, Michael Coogan. He also noted that particular strength in London was also adding to the overall picture and predicted high lending figures in the coming months.

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