The End Of Cheap Loans???

Hector Sants, head of City regulator the Financial Services Authority, has predicted the cheap credit era may be over. He believes the crisis in the financial markets will force the banks to keep more loans on their own books, which could raise the cost of borrowing.

By passing debts to other companies who suffered the loss when debts went bad, banks may now how to keep more loans in house and to cover these bad debts themselves. This could end the ability to provide cheap loans and banks will be forced to provide loans that attract customers for longer terms. This would be the end of the so called 'rate tart', who moves mortgages every time the current special offer comes to an end.