Despite the Bank of England base rate not moving again, thousands of contractors are facing a hike in their mortgage payments this month. Halifax, Co-Operative, Bank of Ireland, Clydesdale / Yorkshire Bank, and NatWest / RBS are the main culprits. Others may follow suit.
How can banks justify doing this to borrowers in a time of financial hardship? Unfortunately they can, and with a consistent message. They cite the cost of wholesale funds as the main reason. The truth is that the inter-bank borrowing rates were higher last year than this year, but certain lenders have chosen to delay passing on the hike to borrowers. The truth is that Halifax started a domino effect, with other lenders seeing it as too good an opportunity to miss.