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Halifax increases fixed rate mortgage interest rate

In a move which is sure to anger for the UK government and the UK population in general it has been revealed that Halifax (now part of Lloyds TSB) has increased the interest rate on 18 out of 52 mortgage deals they have on offer. The 0.2% rise for new customer is despite the billions upon billions of pounds which have been poured into the company in order to ensure its future. So how can the directors of HBOS justify such a move?

Rather bizarrely, the directors of HBOS have pointed to the increased cost of funding in the money markets despite the fact that UK base rates have now fallen to 1%. Many experts in this field are mystified as to how funding costs can rise as interest rates fall lower and lower, with many discounting this excuse. Yet again this puts the UK government face-to-face with a banking group, which has received billions of taxpayer's money, and refuses to give anything back to the mortgage market.

Unfortunately, just as we began to see light at the end of the tunnel it would appear that this is a major step backwards and something which could affect the general trend of the UK mortgage market.

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