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Mortgage rates up ahead of interest rate rise
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
As a result of Bank of England indications that interest rates are set to be elevated, possibly from the beginning of 2016, a number of lenders have already begun to increase their mortgage rates.
Rises
An investigation by comparison website MoneySuperMarket indicates that since Bank of England Governor Mark Carney’s remarks on potential rate rises, a number of previously desirable mortgage deals have become less inviting.
First Direct for example offered a 1.49% rate on its two-year deals at the beginning of 2015, but their best rate now stands at 1.69%.[1]
With this said, data from the report suggests that there are still a number of great mortgage rates available. Additionally, 65% LTV mortgages were found to be typically cheaper than 60% LTV mortgages.[1]
Value
At present, the average 60% LTV rate for fixed, discount and variable mortgages is 2.23%, with the average 65% LTV rate at 2.08%.[1]
Mortgage rates up ahead of interest rate rise
Dan Plant, consumer expert at MoneySupermarket feels that it is, ‘prime time for those looking for a mortgage as there are still some great deals on the market even if it’s a bit bizarre that you can currently get a cheaper deal with a smaller deposit.’[1]
‘However, the recent rate rise speculation is starting to make providers cautious, and this is being reflected in their offers. We know choosing a mortgage can be confusing but if people can do it now, they avoid the risk of rates rising over the next few months,’ he continued.[1]
Plant also said that, ‘many lenders allow mortgage holders to reserve rates available now for up to six months for a small fee, so even those who still have some time left on their current deal can benefit.’ Concluding, he warned that, ‘as always, prospective buyers need to think about the long term and work out the total cost of the mortgage, including both rates and fees, before committing to deal.’[1]
[1] http://www.propertywire.com/news/europe/uk-mortgage-interest-rates-2015080510826.html
