Each month we discuss what is happening in the changes in mortgage interest rates and products, to help keep trainee and newly qualified mortgage advisors abreast of what is happening on a broad spectrum.
The interest rate changes in April are rather mixed. In general, the Bank of England figures released this week show that fixed rate mortgages showed an increase in interest rates, reflecting the fact that the Bank of England base rate stayed at rock bottom and many experts are advising borrowers to fix now whilst they can.
However the cost of variable rate or tracker rate mortgages fell slightly as mortgage lenders encourage borrowers to follow the base rate – no doubt realising there is little more to fall and the only way now is up.
Despite the Bank of England’s official interest rate being at just 0.5 per cent, the cost of taking out a mortgage remains much higher reflecting the high interest rates still being charged on the wholesale markets.
Experts are saying this mixed data suggests that rates for home loans are quite likely to start increasing soon, especially if further positive signs are seen to indicate the bottoming out of the recession.