Mortgage costs rising… Should I sell my house quickly?
It is estimated that around 300,000 home owners with interest only mortgages are struggling to pay them and are at least one month in arrears. An Interest only mortgage is debt but can be classed as good debt as in normal circumstances property prices should rise over time and effectively this is debt that will make you money.
The other option is of course a capital repayment mortgage and this is in the short term more costly as not only are you paying of the interest for your property but you are paying down the borrowed capital amount as well. In the long term a capital repayment mortgage will be paid off by the end of the term, whereas an interest only mortgage will still leave you with your original debt by the end of the term. It is easier to borrow a larger amount with a interest only mortgage and also not only would you be borrowing a larger amount but by having a larger amount of debt sitting around unchanged for many years could leave you more vulnerable to future interest rate rises.
Reasons to sell your home fast
Even though interest rates have now remained unchanged at 0.5% for almost three years now there is new evidence from money supermarket that shows the lenders are increasing their rates. For many who are wishing to sell my home fast their is now even more reason to do so or shop around and try and change your mortgage product. Money supermarket have stated that even more mortgage lenders are changing their Standard variable rate which will be enforced at the beginning of May.
More people expected to sell property quickly
The figures show that mortgage rates hit a low of 3.82% in October 2011. This is the lowest amount since April 2009. New figures show that this will rise back up to 4.15% in may meaning an extra £30 a month for the average mortgage of around £160,000. This may fillip a new influx of home owners wishing to sell property quickly as many thousands of people will feel an extra pinch.
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