With many lending institutions becoming more and more concerned over the growing potential for homes to drop significantly in value over the coming years many mortgage holders with low equity in their homes that are currently on interest-only mortgage options will be moved to repayment plans when their current agreement comes to an end. This could means a substantial change for many current mortgage holders, with those currently holding a mortgage of £150,000 potentially needing to pay an additional £390/month (assuming a 3% interest rate) even with no additional equity needing to be added to their loan amount.

News of the upcoming shift for many lending institutions along with speculation that the current 0.5% low interest rate offered by the central banks has caused many borrowers currently on interest-only options to seek out other fixed-rate mortgage approval before their current mortgage expires, yet at the same time many people simply can not afford to make a move such as this given their own financial limitations. In fact, the new regulations being looked at by most major lenders throughout the country are only for those holding less than 25% equity in their homes – generally those individuals who do not have any additional funds to spare for another major mortgage change immediately should it be needed for their long-term financial benefit.

Despite the fact that this move may come as somewhat of a blow to many home owners throughout the country it is generally seen as a smart move by many economists in order to minimize the impact a second property crash may have on financial institutions. With even re-mortgages hitting an all time low and many people looking at minimizing their amount of extra capital used in the market financial measures are seen by many experts as needing to be taken sooner rather than later to curb any negative shifts occurring as winter approaches.