Mortgage News
Pay down debt before rates rise, consumers urged
Predictions of a rate rise to 8% by 2012 are still just opinion said a debt management adviser, adding that paying off debt is good preparation for the certainty of a rise at some point.
Steve Rees, managing director of debt management firm Vincent Bond & Co said: “This week’s frightening prediction is that within two years, base rate could be 8% – 16 times its current level. Economist Andrew Lilico of think tank the Policy Exchange says this could happen in an attempt to keep inflation down.”
This is a frightening thought for those already struggling with debt and could mean variable mortgage repayments at triple their current levels.
Rees said this interest rate view is only a prediction and the majority-held opinion is that interest rates will rise over the next two years – but by nothing like this amount.
He added: “If nothing else, such predictions should act as a spur to anyone who is currently only just managing to live within their means to pull their horns in.”
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