Recent figures are telling us what many of us have known for a while, namely that we are spending a more of our income on interest payments than we ever have in the last ten years, according to data from the Council of mortgage lenders (CML).
Buyer getting on the property ladder for the first-time are paying out 19% of their income in April on meeting the interest payment on their mortgages and standard “home movers” have been spending 16%, the highest amount that either of these proportions have been since 1992.
With the bank of England base rate having had a several increased in recent months, the council of mortgage lenders figures show that First time buyer demand for fixed-rate mortgage deals remained close to 90% of the overall market, with these products accounting for nearly four in five of all new mortgages taken out!
Director general Michael Coogan has warned that following the base rate increase in May, this situation is most likely to worsen and he has urged borrowers whose current mortgage deals are coming to an end to adapt their financial planning to these rising costs, as it is unlikely that they will be able to find a deal that has similar rates of interest.