1.4m borrowers are going to come off cheap two year fixed rate deals in the coming few months. If you were to believe everything you read these days then you couldn’t be blamed for thinking things are going to get a lot worse in 2008.

While this picture is partially true it only paints a half picture. For borrowers who are looking for a new deal but have a poor credit history because of going in arrears in the past things could get more difficult. These borrowers are faced with a combination of higher interest rates as well as tighter lending criteria.

For instance, Kensington Mortgages, a home loan lender which specialised in sub-prime borrowers has now closed its books to new business. For many sub-prime borrowers, securing a new loan now could almost impossible.

However this will only be true for a tiny minority of borrowers and the majority of borrowers should not panic. Only borrowers with adverse credit should find it difficult to remortgage to a competitive deal, the majority of borrowers should have little trouble finding a deal that while still more expensive than their old deal is still competitive by today’s standards.

All borrowers who are reaching the end of their cheap two year deals should be expecting to be paying more when they switch to a new deal. There are still a lot of good tracker and fixed rate deals out there if you are willing to shop around.