6 Aug

Survey shows borrowers unsure of right remortgage

Survey shows borrowers unsure of right remortgage

A new survey has indicated that four out of ten people would be unsure what type of remortgage to take if they had to choose one now.

The study by Abbey established that 41 per cent of homeowners last month would be unsure whether to take a tracker mortgage or a fixed-rate deal, compared with 30 per cent in June.

Abbey has suggested that this situation has occurred because of the uncertainty over the direction the wider economy will take, with the Bank of England's monetary policy committee (MPC) facing the twin threats of inflation rising too much if interest rates are too low and the economy going into recession if they are kept too high.

Director of Abbey Mortgages Phil Cliff said: "The current uncertainty surrounding base rate decisions and the general uncertainties on the market at the moment are clearly feeding through into consumers views on mortgages."

Predicting that the base rate will be held when the MPC meets tomorrow, Paul Dales, UK economist at Capital Economics, said that such a decision is "the easiest thing to do" at present.

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