The cost of the typical home loan has soared to a seven-year high with families facing mortgage bills more than 20 per cent higher than two years ago as the effects of the credit crunch take their toll. Bank of England figures show that the typical homeowner is paying £135 more a month for their mortgage than last year, prompting fears of a rise in home repossessions as people struggle to pay debts. Most economists expect a series of cuts in base rate this year following December’s drop, although expert opinion is split as to whether the first reduction of 2008 will come this month or in February. This means that someone with a 25-year, £200,000 interest-only mortgage would now have to repay £1,003 a month - £135 more than a year ago, said MoneySupermarket, the price comparison website. Most lenders have failed to cut their fixed rate deals - taken out by two-thirds of new borrowers - since the last Bank of England cut in the base rate. read more