Shelter challenges banks and mortgage lenders to 'pass on' interest rate cut » Bill payments » 24dash.com

Housing charity Shelter today challenged banks and mortgage lenders to pass on the 0.5 per cent interest rate cut and help hundreds of thousands of struggling homeowners.

Shelter figures show more than 900,000 hard up homeowners are now constantly struggling or falling behind every month with their mortgage payments.

If passed on it would mean a household paying a mortgage of £200,000 would see a much-needed average monthly saving of £61.

Shelter chief executive Adam Sampson said passing on the rate cut would give homeowners some financial breathing space and bring some stability to the housing market.

He added: “Shelter figures show more than 900,000 homeowners are constantly struggling or falling behind every month with their mortgage payments. The Bank of England has cut the rate, now lenders have both a financial and moral duty to cut their mortgage rates accordingly.

“The Government has unveiled a £50 billion rescue package to bail out the banks, but in turn the banks should be helping rescue almost one million homeowners who are facing crippling mortgage payments.

"People facing repossession or losing their homes isn’t good for anyone – including the banks and lenders.”

Mr Sampson acknowledged that main lenders like high street banks are under pressure due to the economic downturn.

But he added: “Irresponsible lenders are one of the main reasons why thousands of people are struggling to keep up with their mortgage payments, and why these people live in daily fear of losing their homes.”

Shelter’s call comes as new figures from the charity show it expects almost 125,000 hits by the end of this year on its website www.shelter.org.uk from people seeking mortgage help and advice, an increase of 54 per cent on 2007.