If the global market on interest brings reality to the US from the UK, US homeowners might expect an increase in the rate of interest that they are paying on mortgages.  Many people think that the managers of the US economy have been more proactive in working to save the mortgage industry in the US, but at the end of the day arbitrage is the typical factor that levels the playing field around the world.  That means that the higher rates seen in the UK will eventually help to increase the rates paid in the US as well as investors in the US demand a better return on investment like the one they receive in the UK.

Figures compiled by personal finance website MoneyFacts and carried in the Daily Telegraph show that the average rate for a two-year loan has hit 6.64 per cent, up from 4.34 per cent two years ago.

The Press Association: Cost of fixed-rate mortgages soars

The reality is that in a global economy candles can not be burnt from the same end forever and in this the UK and US economies have been and are still tied at the hip in many forms.

This entry was posted on Sunday, May 18th, 2008 at 11:58 pm and is filed under Mortgage Industry, financing, rates. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.