U.K. Banks Raised Two-Year Mortgage Rates in October, BOE Says

U.K. Banks raised involvement rates on
two-year mortgages in October as they passed higher recognition costs
onto the most popular type of loan used by homebuyers, Depository Financial Institution of
England information show.

The norm charge per unit offered by loaners on a mortgage for 95
percent of the terms of a property, fixed for 24 months,
increased to 6.37 percentage from 6.32 percentage in September, the
central depository financial institution said today on its Web site. The information show the cost
of all other types of two-year home loans also rose.

The study proposes Britons, already struggling to pay
record debts, will necessitate to stretch along their finances additional to buy
homes whose values have got tripled in the past decade. Borrowing
costs are climbing after five interest-rate additions by the
Bank of England and a leap in loaning rates between Banks caused
by contagious disease from the U.S. subprime mortgage slump.

''This was always the hazard that in the current financial
environment, mortgage involvement rates would turn out gluey relative
to their equivalent adulthood barter rate,'' said Saint George Buckley,
chief U.K. economic expert at Deutsche Depository Financial Institution silver in London. The report
''suggests rates are gluey on the downside.''

Today's information shows mortgage rates are still rising even as
the cost of funding two-year loans have fallen. The charge per unit on a
two-year interest-rate swap, which loaners can utilize to hedge
against rising involvement rates, drop to 5.5595 today in London,
the last since March.

To reach the newsman on this story:
Brian Swint in Greater London at