21 Jan

Variable rate mortgages 'will continue to be relatively competitive in 2010'

Variable rate mortgages 'will continue to be relatively competitive in 2010'

Variable rate mortgages will remain a good option for many buyers this year, one industry expert has claimed.

Paula John, editor of Your Mortgage, stated that, even though worse than expected inflation figures have sparked talk of interest rates rising before the end of the year, she does not believe it will impact too heavily on variable rate products.

"I don't think interest rates are going to go above 1.5 per cent this year and that means that variable rate mortgages will still remain relatively competitive," Ms John explained.

She added that until there is a substantial rise in the Bank of England base rate, which currently stands at 0.5 per cent, the number of people opting for standard variable rate products is likely to remain stable.

On January 20th, John Charcol reported that 80.9 per cent of mortgages taken out in December 2009 were variable rate deals.

The company noted that this is the highest percentage of this kind of loan since October 2008.ADNFCR-1222-ID-19571355-ADNFCR

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