Despite the fact that the Bank of England base rate of interest is at an all time low of 0.5%, some mortgage lenders have announced that they are to increase the cost of their fixed-rate mortgage deals.

This news was not welcomed by debt management providers, who see this as yet another increased expense, that hard up consumers are going to have to contend with, in an already difficult economic time. The increased costs could make it impossible for some people to move house, since the new deals would be so expensive, effectively stranding them where they are now.

According to industry insiders, the rises can be blamed on mortgage lenders not wishing to be overly competitive, in the current economic climate, and they are using these rate increases as a way to limit the amount of new mortgages that they are going to have to agree. Lenders such as Barclays bank, Britannia Building Society, Nationwide and Northern Rock have already increased the cost of their fixed-rate deals.

For homeowners that are in financial difficulty, anything that adds to the costs of keeping a roof over their heads is bad news, as it can decrease the amount of disposable income that they have available to pay towards their other commitments, such as credit card debt, catalogues and store cards and personal loan agreements.

The problems that are being faced by consumers right now are bad enough, as this news comes on the back of a collapse in the housing market. Many homeowners are effectively stuck on standard variable rate deals, which are costing them more each month, and they are unable to move to a better deal because there just aren’t any about.

The future does not look too bright either, as experts predict that the economic downturn will be with us for some time.