House owners urged to stay calm
The message from a Telford mortgage broker to lenders in Shropshire who are looking to buy a house or who already have a mortgage is 'don't panic.'
Dan Harris has urged customers to get in touch, with interest rates expected to rise sharply after the government's 'mini budget' on Friday.
Lenders withdrew a record number of mortgage products overnight on Tuesday according to analysts, as they grappled with the expected rise, which economists are predicting could lead to a 10-15 per cent drop in house prices
Economists are predicting the interest rate rise could lead to a 10-15 per-cent drop in house prices.
Mr Harris is a partner in Q Financial Services, a mortgage broker and financial advisers in Wellington. He said a lot of people had been in touch for advice over the last 24-hours on whether they should change their mortgage deal, particularly those who are fixed in for a long period of time and they were working through their list of customers.
Dan said: "There is a lot of uncertainty at the moment but it would be wise for people with existing mortgages to take a step back and not panic too much.
"The situation is changing all the time and a rate that is reported at 1pm could be a lot different to one reported at 4pm - we are expecting rates as low as one-per-cent to perhaps go up to something like six per-cent. Currently we are basing advice on a rate of in the late fours.
"One thing we would recommend if you can do it is to re-look at your mortgage and consider increasing the term over which it is paid which may lead to a lower rate, but not everyone can do that of course.
"For new customers as well, a number of mortgage products have been withdrawn which brings down choice so again the best advice is not to rush into anything shop around or give it a few weeks to see if the market settles down.
"We are here to give advice to new customers, existing ones or potential ones but for those who do have mortgages, where we would give advice to someone coming to the end of their term we will be doing that earlier because of the uncertainty caused by the market - equally I would advise people to get in touch about their current deal as soon as possible.
The Moneyfacts website said the fall in mortgage products on offer was the biggest daily drop it has ever recorded. It was double the previous biggest drop, which occurred at the height of the Covid pandemic.
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