Although new home buyers are seeking a fixed rate mortgage for more security, most are finding that it is very difficult to get an approval. The rates for fixed rate mortgages are going up and extra fees are making these loans cost prohibitive for many. First time buyers are truly being affected by changes in the fixed rate mortgage market and may find that their only options include variable rate loans, which can cause payments to skyrocket.
Moneyfacts mortgage expert Darren Cook said: ‘The last resort for a growing number of borrowers is reverting to their lender’s standard variable rate and it is not unreasonable to predict that a majority of borrowers will be left with only this option during the next six months if markets do not improve.’
Royal Institution of Chartered Surveyors senior economist David Stubbs said: ‘Access to the housing market has deteriorated as the credit crunch has taken hold of the mortgage lender sector.
‘With mortgage approvals declining, the picture does not look like improving in the latter part of 2008 - and first-time buyers will find their path to home ownership increasingly blocked.’
Related reading: Home Mortgage
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