CML in mortgage reminder

The Council of Mortgage Lenders (CML) has issued a statement reminding those hoping for lower standard variable mortgage rates that such eventualities are not the inevitable result of any Bank of England base rate cut.

On the eve of the latest monetary policy committee decision on rates, the CML said: "This is a commercial decision for individual lenders, and their responses are likely to vary."

Concerns such as mortgagefinance were likely to also play a part in these decisions, the body said.

During this week it has been reported that chancellor Alistair Darling is planning to set a gold standard kitemark for mortgages with high credit ratings, the idea being to generate confidence that such mortgages can be securitised, thus providing the finance which has become scarce since the subprime crisis began last year.

Last month Mr Darling stated: "The easing and recovery of those [securitisation] markets is essential to stabilising the housing market".

However, critics have argued this may increase further the differential between subprime and prime mortgage costs to the disadvantage to the former.

Those hoping not to have to worry about interest rates or suprime mortgage costs may look to use the self build option as an alternative way of getting on the housing ladder.


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