Repayment rates are on the up again for Abbey mortgage holders, due to credit crunch-related concerns at the lender.
Recent cuts made by mortgage lender Abbey to some of its rates have been reversed, it has emerged.
The mortgage firm has announced that it will raise the fixed rate deals in question by between 0.15 per cent and 0.56 per cent from today. This move follows the lender's decision to cut flexible and tracker rates by 0.05 per cent and reduce fixed rates by up to 0.17 per cent earlier this month.
Many firms in the UK have raised their rates as a reaction to the ongoing credit crunch. This is because a primary feature of the global financial crisis has been a general reluctance of banks to lend money to each other cheaply on the wholesale markets. In turn, these high inter-bank lending rates have then had a knock-on effect on deals offered to consumers, and Abbey's latest move confirms that many financial firms are still feeling the effects of the credit crunch.
Indeed, the effects of the crisis have been so acute that three separate reductions to the base rate of interest from the Bank of England in recent months, which has reduced the rate from 5.75 per cent to its current level of five per cent in a bid to make mortgage deals cheaper, have been completely counterbalanced by lenders.
Elsewhere, mortgage lender Woolwich also announced that it was putting up the rates it sells through brokers by up to 0.3 per cent, due to similar credit crunch-related concerns.
