Major banks meet Chancellor with mortgage rates

The impact of the recent financial market turmoil on the mortgage market is set to be discussed with major banks meeting the chancellor on Thursday.

The meeting is thought to be part of a regular series of talks but has attracted more attention because mortgage rates are soar and choice is limited.

Mortgage rates went up for months but went up sharply in response to the fall-out from the mini-budget nearly two weeks ago.

First-time buyers and those looking to remortgage are affected. An average of 100,000 people a month are coming to the end of their current mortgage and face a significant rise in their monthly payments.

According to research from the Housing Market website BuiltPlace, 6% means that repayments on an average new mortgage will account for more than a quarter of household income.

They are slowly starting to return - there were 3,961 products a fortnight ago, now there are 2,430 - but have become more expensive on average.

The Halifax, the UK's biggest mortgage lender, raised its rates on a range of deals for new borrowers to well over 5% earlier this week.