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Mortgage costs may increase if Greece leaves the euro

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    Mortgage costs may increase if Greece leaves the euro

    "The crisis could add hundreds of pounds a year to the cost of a typical home loan, according to Adrian Anderson, from mortgage broker Anderson Harris, who believes that mortgages could rise by three quarters of a percentage point if the eurozone crisis escalates.

    "There will be plenty of pressure on lenders to reduce the amount of lending they do, improve margins and raise mortgage rates in coming weeks," Mr Anderson said. "We are already seeing lenders raise rates, and that's even before Greece has made any official decision to leave."

    Economists from thinktank Capital Economics believe that the cost of a typical home loan could rise from 3.6pc to 4.5pc if the crisis worsens. This would push up repayments on a £250,000 home loan by £1,200 a year.

    Howard Archer, chief economist at IHS, said that households would find it even more difficult to get mortgages than they are doing at present. "I suspect banks would be even more careful in their lending for some time to come – which would make it harder for many people to get mortgages," he said.

    There is already evidence that banks such as Santander, which is Spanish owned, have pulled back on lending in recent weeks. Brokers said that the bank was less keen to lend through them. "

    Source: Mortgage costs may increase if Greece leaves the euro - Telegraph

    So who here says again that collapse of euro is a good thing?

    #2
    The collapse of euro is a good thing.
    one day at a time

    Comment


      #3
      Who cares, it's only a few quid a month. We spend more a month on Latte's and and other carp.
      Confusion is a natural state of being

      Comment


        #4
        The Halifax just increased their base rate .75%. I think they'd be a lot of anger if they started doing it some more, given most have been bailed out by the tax payer. I could see the Government getting involved if they start feathering their bottom line by being more than X points over base rate.

        We'll see, but I think there'd be a lot of resistance to it.

        Comment


          #5
          Originally posted by Old Hack View Post
          I could see the Government getting involved if they start feathering their bottom line by being more than X points over base rate.


          What exactly Govt can do?

          Comment


            #6
            Originally posted by AtW View Post


            What exactly Govt can do?
            Put a cap on the amount they can charge over base rate? There's many things they can do

            Comment


              #7
              Originally posted by Old Hack View Post
              Put a cap on the amount they can charge over base rate?
              Direct price controls? Unlikely and it won't work anyway - the "arrangement" fees will be even higher and perhaps a new monthly "account fee" will be introduced. It's like in Islamic finance - charging interest is not allowed, yet that nobody stopped anybody profiting

              Comment


                #8
                Originally posted by AtW View Post
                Direct price controls? Unlikely and it won't work anyway - the "arrangement" fees will be even higher and perhaps a new monthly "account fee" will be introduced. It's like in Islamic finance - charging interest is not allowed, yet that nobody stopped anybody profiting
                No doubt they'd always be looking for ways to make money, but I'd venture the extra squeeze on peoples budgets would be looked at very harshly. I think in the less well off, things are pretty tight just now. I was reading about some people the other day ranting about the car costing 80 to fill up, and they were only earning 250. I think it's biting and will only get worse if they add the 3p on planned in August. I really don't think politically this will go down well.

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