Thursday 6th September 2007
An impending "rate shock" could see 250,000 households needing to remortgage, Nationwide predicts.
That is the number expected to leave two-year fixed-rate mortgage deals between October and December of this year, according to the financial services provider.
Homeowners looking to remortgage are advised to "choose their mortgage carefully" as the difference in repayments on a new five-year deal can be up to £2,675.
Matthew Carter, Nationwides director of mortgages, states: "For some borrowers it will come as quite a fright to see their mortgage payments increase dramatically.
"To absorb some of this shock, borrowers need to consider remortgaging as soon as their deal ends."
He adds that long-term packages such as 25-year fixed rates have become increasingly popular in the wake of recent interest rate rises by the Bank of England.
The lender previously identified a two point fall in its Consumer Confidence Index in light of affordability issues stemming from the rate hikes.
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