DAVID CHADWICK, the Liberal Democrat MP for Brecon, Radnor and Cwm Tawe, has accused mortgage lenders of treating homeowners as “cash cows”, with mortgage rates failing to fall in line with interest rates.
It comes after House Of Commons Library research, commissioned by the Liberal Democrats, found mortgage rates have fallen at a significantly slower rate than the fall in the Bank of England base interest rate over the past year, costing homeowners over £1,000 a year.
It means that for new mortgages the estimated average monthly payment has fallen by just £90 a month to £1,189 from £1,279 for two year fixed rates and by only £26 a month from £1,204 to £1,178 for five year fixed rates.
The Library’s research revealed that if instead two and five-year fixed mortgage rates had fallen by 19%, in line with the base rate, then homeowners would be paying a further £41 and £87 a month less respectively. It means that mortgage holders would be saving £492 a year on a two year fixed rate and £1,044 a year on a five year fixed rate mortgage.
This is particularly relevant for communities across Brecon, Radnor and Cwm Tawe, which have faced a wave of bank closures in recent years, including Lloyds branches in Brecon, Presteigne, Ystradgynlais and Pontardawe, leaving residents with fewer local services while the CEO of the banking giant, Lloyds, pocketed over five and a half million pounds last year.
David Chadwick MP said that Rachel Reeves has to “stand up for struggling mortgage holders in Wales” and has called on the Chancellor to reverse the Conservative Party’s tax cuts for the big banks as they see billions in profits from sky high mortgage rates.
David Chadwick, Liberal Democrat MP for Brecon, Radnor and Cwm Tawe said: “It’s really disappointing to see that hard-working homeowners in Wales are being used as cash cows by mortgage providers, particularly in the midst of a cost-of-living crisis tightening so many people’s purse strings.
“The Government has been far too timid and wrong-footed in tackling the cost of living crisis. Mortgage rates are crippling homeowners, and spiralling energy bills leave people wondering how they will put food on the table.
“The Chancellor must stand up for struggling Welsh mortgage holders, and she can start by reversing the Conservative Party’s unfair tax cuts for the big banks, who are making billions in profit off the back of sky high mortgage rates.”
