According to research by Moneyfacts, the financial product comparison website, fixed-rate mortgages are increasing in cost after three months of record lows.

Company representative Sylvia Waycot explained that those with larger deposits were being affected more; the cheap rates for first-time buyers had remained unchanged.

Borrowers whose deposits are between 10 and 40 percent are currently seeing fixed-rate mortgage costs rise. Traditionally, those with 40 percent deposits have been regarded as safer by lenders, and interest rates over the last year have remained at less than 1.5 percent. However, West Bromwich Building Society – which this month offered the lowest two-year fixed deal available for those with a 40 percent deposit – has increased its rate from 1.48 to 1.58 percent. For those with 10 percent deposits it is a similar story, with the lowest rate available having risen from 3.39 to 3.44 percent.

Waycot said that lenders use swap rates to set the prices of their loans, and fixed-rate mortgages are closely linked to these. Uncertainty surrounding a possible increase in the Bank of England’s base rate has caused swap rates to rise, and borrowers are now paying the price, even though the base rate has yet to shift upwards.

Consumers with deposits of between 10 and 40 percent who are currently looking for the right fixed-rate mortgage deal might be wise to consult experts for advice in the present climate and, as the demand for professional help is on the rise, more people are also opting to undergo CeMAP Training to meet the need for mortgage advice provision.

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