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Do you know how an interest rate rise will affect you?

Friday 9th April 2010

Property in South East London enjoyed a boom during the noughties. Many houses were bought, and are currently being paid for, on interest only mortgages. Economic pundits across the board are suggesting that interest rates will stay static this year but are warning that they are set to rise in the early part of 2011. This is relatively good news. It affords you the time to get your economic house in order before interest rate rises affect your repayments.

Greenwich Estate Agents saw the noughties housing boom fuelled by interest-only mortgage holders speculating on price and selling for a profit with little money down. Times, and economic circumstances, have well and truly changed. With many interest-only mortgage holders locked into standard variable rate deals, they will be at the inevitable mercy of the rate rises when they come.

Speak to your mortgage provider about what will happen to your payments if and when the interest rate goes up. Rather than wait for it to happen, you can at least prepare yourself and finances for the future. They say only death and taxes are inevitable. However, if the financial pundits are to be believed that may also but true of an interest rate rise. The good news is property in East London is as desirable now as it was then. Despite adjustments in the housing market over the last few years – your bricks and mortar are still a solid investment.

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