Many homeowners will have been relieved to hear that the Bank of England’s Monetary Policy Committee confirmed that the current base interest rate of 0.5 per cent would be maintained for another month but it was suggested that mortgage lenders would still increase their standard variable rate (SVR) this year.
A spokesperson from What Mortgage commented that although the base interest rate may stay the same, most major mortgage lenders would still be likely to increase their SVR in the next few months. He said:
“Most lenders don’t use the Bank of England rate as a marker because they have to borrow money from the money markets and those rates have been rising.
“Increasing SVRs always starts off [when] a couple of them stick their heads above the parapet and once that has happened – and presumably they have got all the criticism for it – then all the other lenders will do it as well.”
All good mortgage advisors would recommend that anyone looking to acquire a mortgage or to remortgage onto a new mortgage deal right now should shop around and this is even more important right now.
Those looking at becoming mortgage advisors or learning in detail about mortgages through a CeMAP training course will learn about all the different aspects that can contribute to a mortgage deal and its value or cost, such as tie-in periods, redemption rates and how all mortgage types work.