Fixed-rate mortgages ‘offer debt relief’
Fixed-rate mortgages may offer debt relief for homeowners with affordability concerns, it has been claimed.
The Council of Mortgage Lenders (CML) suggests that fixing monthly repayments is a good means of budgeting over the long-term.
Spokesperson Christopher Dean adds that this could be especially helpful for first-time buyers who are at the limit of affordability when arranging their mortgage.
His comments reflect figures from the CML which show a record proportion of first-time buyers opted for a fixed-rate package in June.
Mr Dean advises that with a variable rate mortgage repayments can change - and that this is “where people start to fall into affordability difficulties or payment difficulties”.
“With a fixed rate at least you know how much you’ll be paying each month,” he adds.
Nine out of ten first-time buyers in June took a fixed-rate deal, the CML figures show.
With a base rate rise in July and a widely anticipated future rise predicted to come later in the year, affordability could be stretched still further.
Expert assistance could provide further debt relief for homeowners concerned about their finances.
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