Mortgage rates have been increased by ten lenders during a seven-day period, as they anticipate the Bank of England raising the base rate.
Halifax and Nationwide are among the lenders to have increased the rates on a number of deals, with fixed rate deals most affected. The deals increased are the two- and five-year fixed rates for new borrowers.
Fixed rate deals have been at their lowest for a reasonable period of time, and any concern that interest rates may increase will no doubt prompt borrowers to take out one of the record low deals while they last.
The largest building society, Nationwide, has increased the interest rate on the fixed two-year deal, its cheapest, to 1.44% from 1.19%. According to broker David Hollingworth from London & Country, although the increases in fixed rate deals is currently small, they could easily pick up their pace as lenders changed rates to match rivals.
Hollingworth added that borrowers who had not yet taken advantage of one of the ultra-low deals may want to consider doing so. The borrowing and savings rates rise and fall in accordance with the Bank of England’s base rate, which is expected to increase in November.
Swap rates are also a factor in rising interest rates, as they have doubled during the last year. This has pushed up the cost of fixed rate deals. Mortgage advisors learn about swap rates and other factors in a rate increase when they take CeMAP training.