Sub-prime Mortgage Customers

Sub-prime mortgages customers are under no greater risk from interest rate hikes than other mortgage customers, it has been claimed.

Typically, sub-prime mortgages – those offered to customers with a poor credit history – are charged at a higher rate of interest to those offered to more financially secure customers. However despite the higher rates, such mortgages are not necessarily more vulnerable to interest rate changes.

Mortgage borrowers with mortgages from non conforming lenders will not recieve a higher rate rise relative to any other mortgage borrower. One point worth looking at are for the borrowers who have a product linked to the London Inter Bank Offer Rate (LIBOR) which is often slightly different to the bank of england base rate.