Thursday, April 19, 2007
This should make people think twice before they buy
Lenders have started to withdraw their fixed-rate mortgage products in preparation for a possible Bank of England (BoE) interest rate rise. Alliance & Leicester pulled its fixed-rate deals on Wednesday, and the BBC has been told that two other major mortgage lenders will now follow suit. Lenders often withdraw mortgages when interest rates rise. They base their borrowing costs on money market rates, which in turn are linked to the BoE's rate. Price growth On Wednesday, the UK inflation rate rose to 3.1%, which was higher than expected.