Chancellor Alistair Darling has announced the Government will incentivise mortgage lenders to increase the take up of fixed-rate loans and encourage them to increase terms from two years to 10 years or more.
He said: “Fixed-rate mortgages can offer more certainty and I want to see more fixed-rate mortgages not just for two years but ten years or even longer. I will bring forward proposals at the Budget on reforms to help lenders ensure that, if it is right for them, more people can fix their mortgages as a matter of routine.”
CML director general Michael Coogan says: “We look forward to seeing the proposals that the Chancellor said he will bring forward in the budget. There is a key trade-off for borrowers in choosing a longer-term fix, relating to the potential costs of exiting the deal early, and this is the key feature that needs to be addressed to stimulate mainstream consumer appetite.”
Darling also announced plans to increase the number of homes built to 240,000 a year by 2016 and said the Government will spend more than £4bn over the next three years to help people living in poor quality housing make renovations to their homes.