IT is more than 15 years since the bank base rate was last at five per cent and in between time interest rates for the most part have been sub one per cent.

It is this time period of exceptionally low interest rates that, more than any other reason, has resulted in this now so-called mortgage repayment crisis.

Prior to this period interest rates were always much higher and many people will still remember the double-digit base rates throughout the majority of the 1980s.

People are now finding it difficult to repay their mortgages because when they borrow to their maximum capability at very low mortgage rates, they will inevitably buy the biggest and best property they can afford at that time.

When those purchases are being made during a period of more that 13 years which saw the bank base rate at under one per cent, many mortgage borrowers will have no experience of anything other than cheap money and would likely be lulled into the belief that borrowing would always be cheap.

And history tells us that is never the case.

Demand for housing during this time has been high, exacerbated by the ability to borrow higher and higher amounts of money at extremely low interest rates.

This has resulted in significantly higher house prices, with savers receiving minimal rewards over this period whereas borrowers have been rewarded by seeing the properties they buy rise quite considerably in value.

Over time the gap between salary levels and house values will then increase but, no matter, as long as rates remain low and lenders allow greater multiples of salary when granting mortgages, which is the case, they remain happy.

But come the march of inflation and the deployment of increasing interest rates to combat it, then the mortgage repayment crisis which now engulfs many borrowers is the consequence.

The Government cannot directly get involved as it would set a dangerous precedent, but plainly in the short-term lenders must assist borrowers as best as they can and there are numerous tools available for them to do so.

But what banks and building societies must also do is pass higher rates on to savers, something which they are not doing with any degree of equilibrium.

At present these institutions are making more and more money by raising rates to borrowers but not increasing savers rates as quickly or to the same level.

And that is wrong.

Ian Thompson, Spennymoor