Halifax's mortgage rate rise to increase average repayment costs.

The news that the Halifax is to introduce a mortgage rate rise is of concern to many of their mortgage holders who could face paying around £735 more each year. This rate increase may result in customers remortgaging and leaving the bank.

The Halifax variable mortgage rate rise means that from 01 May this year their rate will increase by 0.49 per cent to 3.99 per cent. This means that for those on a £150,000 interest-only mortgage deal, repayments will rise by £61 per month or £735 per year.

The increase may be seen as profiteering by some home-owners who see that BOE base rate remains unmoved at 0.50 per cent. However, the bank advises that this is not the case, the rising costs of borrowing money from wholesale markets in the last 12 months is to blame for the increase.

The Halifax report that they have had to bring in extra call centre support staff to deal with calls from worried customers.

At Deal Direct we anticipate that mortgage customers whose rate is to rise may want to remortgage and switch to a new deal to avoid the increase.

As you should be given a three month period in which to switch deals without incurring repayment charges, we recommended that you look around and compare remortgages without delay.

Competitive Deals are available depending on your personal circumstances and so to avoid a mortgage rate rise contact our expert mortgage brokers now.

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