Interest rate rise 'would not affect mortgage approvals'

Posted by Mark Cunningham

People looking to advance up the UK's residential property ladder in 2011 are unlikely to have their chances scuppered should the base interest rate rise at some point during the year.

That is the view of Catherine Hearnden, director at My Mortgage Direct, who has said that if, as is widely expected among financial analysts, the Bank of England raises the base rate from its current level of 0.5 per cent at some point in 2011, this will not significantly impact on the number of mortgage packages being approved.

However, Ms Hearnden added that although liquidity is not likely to be affected, any increase may have a negative effect on the level of consumer demand for such products due to the "panic" it would cause.

This comes after the central bank last week (February 1st 2011) revealed that both the number of loan approvals and remortgages for house purchases dipped in December 2010.
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07/02/2011 15:15

News category: Property

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