Carney: Mortgage borrowers need to expect difficult conditions

Ryan Fowler

July 5, 2016

mark carney governor of the bank of england

Bank of England governor Mark Carney has warned that mortgage borrowers need to expect difficulties in the future in light of the current economic situation. 

Speaking at a press conference Carney pointed out that Bank had previously identified the referendum as the biggest threat to the UK economy.

And he said that its warning is now being borne out with sterling at a 31-year low following the vote to leave.

Protect and survive

He also said there is growing evidence that the referendum has delayed major investment decisions.

Mortgages

When asked his advice to people who are wondering about taking out a loan or mortgage the BoE governor said: “We are advising people to be prudent.

“If you are taking out a mortgage, at some stage, during the life of that mortgage, conditions will be difficult.

“So you want to be sure, as a household or an individual, that you can repay that mortgage – you don’t want to lose your house or flat.”

Interest rates

Carney also discussed the prospect of a cut to the Bank Base Rate on July 14.

He said any measure to stimulate the economy would be well-aimed and focused on the domestic economy.

But he warned of “unintended consequences” that could come from ultra-low interest rates.

 

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