Thursday 8th of October 2009
Homeowners with tracker mortgages may want to take advantage of the Bank of England’s announcement that the interest base rate will remain at 0.5 per cent - by improving their overall financial position with individual voluntary arrangement (IVA) help.
A low interest rate means those with the tracker system are asked to find a smaller monthly payment than usual for their home loan.
Some people may want to take advantage of this by making larger repayments than required so that their outstanding mortgage debt is smaller when interest rates start increasing.
Alongside this, it could be a good idea to take out an IVA to deal with unsecured debts, such as credit card bills.
An IVA could restructure what you pay on unsecured debts over £15,000 by freezing interest rates and setting a fixed period in which debts can be settled.
This, in the short term at least, may allow homeowners to take advantage of the low interest base rate by making large mortgage repayments.
By Hayley Jones
- House price rise 'may not indicate recovery'
- Equity release 'needs to be increased'
- Need for IVA help could increase as expert predicts reduction in lending
- Government announces 'breathing space' for those needing IVA help
- Lack of subprime lending creating need for IVA help, expert suggests
- Will IVAs be added to the shopping lists of women?
