No less than ten mortgage lenders have increased their rates over the past seven days.
The increased rates have mostly affected those borrowers looking to ‘lock in’ for a set period – usually two, five or ten years. The rise in rates has been blamed on The Bank Of England which has suggested that the UK should expect an increase in interest rates from November.
“What we have said, that if the economy continues on the track that it’s been on, and all indications are that it is, in the relatively near term we can expect that interest rates would increase somewhat,” commented The Bank of England Governor, Mark Carney, in an interview with the BBC’s Today programme last week.
Some mortgage lenders, including Halifax and Nationwide, have preempted the rise by increasing the rates of its fixed rate products. It is expected that many more lenders will follow suit – meaning that borrowers are being encouraged to take advantage of any cheap deals now.
“Borrowers that have so far failed to take advantage of the ultra-low fixed rates may want to consider if now is the time to act,” commented David Hollingworth of broker London & Country. “The Bank Rate, set by the Bank of England, is the barometer against which most household savings and borrowing rates rise and fall. It is now expected to post its first increase in more than a decade, come next month.”
Nationwide, the UK’s largest building society, raised the rate on its cheapest two-year fixed deal from 1.19% to 1.44%, while Halifax increased selected fixed rates by 0.2%. Monmouthshire Building Society, Newcastle Building Society, Aldermore, Skipton, Coventry Building Society, Santander and Leeds Building Society also all increased their rates.
