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News Release 5th August 2004HOMES IN DANGER?With interest rates having risen a further 0.25% today - the fifth interest rate rise since November, Michael Fabricant says: "People who have recently bought expensive homes in the Lichfield and Burntwood area as well in other parts of the midlands when interest rates were lower will begin to feel the pinch as interest rates rise inexorably. My fear is that unless home-owners have some spare cash available, house buyers may not be able to keep up mortgage payments. If too many homes come on to the market, house prices will fall causing negative equity: that is, the value of the home falling lower than the value of the mortgage taken out to buy it. And that means that even taking the extreme step of selling the home, still results in money being owed to the building society. "Much of this is due to Gordon Brown who has spent more than he has collected in tax forcing the Bank of England to raise interest rates. And his budget black hole is looming larger. In the meantime, I would advise anyone with fears as to how to manage their debts to speak with specialist advisors at the Citizens Advice Bureau", adds Michael. |
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