Banks have been accused of exploiting home buyers by having the biggest profit margins on mortgages for more than 20 years.

Despite the Bank of England’s interest rate remaining at a historic low of 0.5%, borrowers are paying up to 8% on some fixed rate home loans.

Buyers are also being hit by rising arrangement fees, the average cost of which has jumped to more than £1,000.

Among the worst offenders are banks that have received billions of pounds in government assistance.

On Friday, Northern Rock, the nationalised bank, increased the rate on its fiveyear fixed rate deal by 0.6% to 6.29%.

Daily Telegraph

Topics