Reaction to mortgage shake-up plans

Posted: 11 Jul 2007 10:39:55 GMT


            Property News - Reaction to mortgage shake-up plans

Comments on the UK mortgage market by chancellor of the exchequer Alistair Darling have received a mixed response.

Comments on the UK mortgage market by chancellor of the exchequer Alistair Darling have received a mixed response.

Mr Darling called for more long-term fixed-rate mortgages to be made available to borrowers, in a bid to reduce volatility in the market.

However, some critics have argued that the plans merely scratch the surface of the problem and want to see greater changes.

"I can see that for people on the margins and unable to get into the market it provides them with some temporary relief," Liberal Democrat shadow chancellor Vincent Cable told the Guardian.

"The problem is that people's mortgages are continuing into their retirement and old age and they will never be able to repay them."

The Council of Mortgage Lenders has urged Mr Darling to focus his attentions on affordability and has also called for housing supply to be improved.

Some mortgage lenders have welcomed the chancellor's comments, with Yorkshire Building Society's chief executive Iain Cornish saying: "The issue up to now is that there has been little demand for terms as long as 25 years but there are signs that the British public are weaning themselves off the need to change lender every two or three years.

"We are currently working on a new proposal which will radically change the consumer's view of longer term products and we expect to be in a position to make an announcement in the next few weeks."

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