Homeowners face higher rates

Published on Sunday 9 September 2007 00:40

Mortgage costs are still edging higher despite the Bank of England's attempts to calm markets by leaving underlying borrowing costs on hold.

The credit crunch is pushing up money market rates, which will squeeze fixed rate and discounted deals.

However, borrowers have been warned that if they do fall behind with repayments, they will see their debts escalate as they get hit with eye-watering charges.

Moneysupermarket.com says that if your mortgage cheque or direct debit bounces, Halifax and BM Solutions will charge you 35, C&G 31, Northern Rock and GMAC 30, and Coventry 20. Thereafter the Halifax charges 35 for every letter or telephone call and 100 for debt counselling.

Others add fees for however many months you are in arrears, from 10 at C&G for the first month, 30 for the second month and 30 for the third. GMAC charges 50 monthly.