Halifax Raises Tracker Mortgages Rates

In a move that must surely mean that the credit crunch has reached the UK main market, we have seen Halifax today announce a rise of between 0.1% and 0.2% for their range of tracker mortgages.  The changes will come into force on Friday and they have worrying implications for the rest of the sector.

Halifax are the largest mortgage provider in the UK and have their finger very much on the mortgage market pulse.  The rise has been blamed on the recent increase in short term borrowing costs due to a lack of lenders available in the inter bank money market - the area of finance where institutions lend to each other on a short term basis.  This lack of available lenders has pushed up the loan rates for what is available, which has had an immediate impact upon profitability, margins, etc.

When you consider today’s announcement by the Halifax and the collapse of little known Victoria Mortgages, there are problems in the UK sector.  There are also reports showing that UK property prices fell last month for the first time since 2005. 

This will only be the tip of the iceberg, and more depressing news is sure to follow.