Grant Bailey, analyst at Fitch Ratings, said: “In an environment of falling home prices and limited refinancing opportunities, loans with these characteristics have shown a high propensity to default.”

Sir James Crosby stated, “The sooner we can make that adjustment [to the housing market] the better . . . pretending there is a magic solution is not the answer. The issue about the mortgage market is whether the business model of some of the mortgage lenders needs to be adjusted and whether there are sufficient sources of funding to supply mortgage lending. Funding is not something a central bank can provide.”

CML director general Michael Coogan said: “Holding the Bank rate is better than raising rates, as one MPC member suggested last month, but a reduction would have been a welcome recognition of the current financial strains on households already struggling with hikes in other living costs.

“As a result of recent bank rate reductions, mortgage rates are below their peak at the end of 2007 but many consumers will be looking to the MPC to respond soon to the slowing economy and reducing inflationary pressures.”

Chief economist Fionnuala Earley commented, “As the cost of mortgages begins to come down, activity could be bolstered and restore some liquidity to the housing market. However, this is not likely to happen overnight. Overall the weakening economy and poor housing market sentiment do not suggest that the market will recover quickly. But, if oil prices continue to fall and the MPC is satisfied that its inflation credentials are intact, the possibility of earlier rapid cuts in interest rates increases. which would be good news for borrowers.”

“Mortgage set-up fees have got to come down, as the Chancellor recently stated, lenders are taking advantage of borrowers by charging as much as £2,500 just for arranging a mortgage. With such costs, it is no surprise that the number of people who cannot afford to buy is relatively high. The fact that a long term fixed-rate mortgage was still so popular is surprising in the current financial climate. The fact that people would still consider fixing at high rates for more than ten years suggests that consumer confidence is low and borrowers are after long term security during unstable times,” said James Caldwell the director of FairInvestment.

Jeremy Leaf, a spokesman for RICS, said: “With demand so low, would-be buyers are negotiating from a position of strength. Even in a weak market, there are always opportunities for investors and buyers to profit and some are starting to circle for bargains.”

CML director general Michael Coogan commented: “The growing popularity of fixed-rate mortgages, despite the relatively high rates, suggests that many borrowers are prioritising certainty in their monthly payments.

Darren Cook of Moneyfacts added, “We hope, under the current economic climate, that the polls are correct and no base rate change takes place on Thursday at 12h00 and stays at 5.00%, otherwise an increase might give lenders the opportunity to adjust their SVR well above the base rate movement and wipe out any option of a reasonable last resort.”

Ann Robinson, from USwitch stated, “However, adding fees to a mortgage means that you will be spreading the amount over many years and paying interest for the pleasure of doing so - this is an extremely expensive option and should always be seen as a last resort. If you can in any way manage to pay the fee upfront this will always be your best option. Otherwise buyers should make sure that they make regular overpayments to minimise the impact of high interest costs - as they could end up doubling the original cost of an arrangement fee.”   

Michael Coogan of the CML stated, “Individual lenders are having to balance consumer demand with service considerations, as many of those active in the market are seeing higher levels of applications than they can deal with in the wake of the overall tightening in supply of funding to the market.”

PSFM mortgage adviser John Postlethwaite says: “It has never been harder to call what will happen to mortgage costs next, as there are so many conflicting pressures. But nothing much will change until banks come back into the market and start cutting their margins and lending again. It would also help if the Bank of England’s interest rate remit was widened so the Monetary Policy Committee could consider a broader range of factors when deciding the next direction of borrowing costs.”

Kevin Mountford, head of savings at price comparison site moneysupermarket.com, says: “We have seen some fantastic fixed rate bonds pop up recently. While savers can now take advantage of several accounts offering over 7%, if you can hold on for a little while longer it might prove financially worthwhile. We can expect even better rates to trickle through if, as expected, the Bank of England raises interest rates again.”

For those trying to get a secured loan rate UK, they are quickly finding that the rules of the game have changed. Banks that used to offer secured loan rate UK plans at terrific rates have altered their lending rules to the point that it is nearly impossible for many to get an approval. This is being blamed on the housing crisis and the need for banks to avoid having a similar problem happen in the future. Right now, only those with the best credit will have access to secured loan rate UK loans until the market changes.

However, by using quote sites and a broker, many consumers are finding that it is easier to get a secured loan rate UK this way. Brokers usually have access to numerous lenders and they can really make it a lot easier to get a secured loan rate UK that is doable. Although many banks are raising their rates for secured loan rate UK products, by searching and shopping around, consumers can save a lot of money on interest rates. This technique can make a big difference when it comes to paying off a secured loan rate UK loan.