Debt Alert: Skipton breaks mortgage rate promise

22/01/2010

Thousands of borrowers could be pushed into debt problems'>debt problems after Skipton Building Society dropped a price promise to its customers.

The society wrote to homeowners telling them that, due to "exceptional circumstances" brought on by the credit crunch, its mortgage rate would no longer remain within the promised three per cent of the Bank of England base rate.

The Daily Telegraph has reported that 29,000 of Skipton's 100,000 mortgage customers have been told they could pay an estimated additional £2,000 per year in interest. Another 35,000 customers could still to be affected.

Kevin Still, director at EuroDebt, said that "finding an additional £167 a month from disposable income will be tough, and there will inevitably be debt problems arising from this".

Recent research from Scottish Widows found that the average mortgage debt for a family with children had already increased by £3,000 in the last year.

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