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Fixed rate mortgage costs rising

Fixed rate mortgage costs rising

Category: Mortgages

Updated: 09/07/2009
First Published: 09/07/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Figures from Moneyfacts.co.uk have revealed that the cost of fixed rate mortgages is continuing to rise, despite swap rates falling over the past month.

Currently, the average two year fixed rate mortgage stands at 5.18 per cent, a rise of just over a half percent compared to the start of June, when the average stood at 4.67 per cent.

The margin between the average two year fixed rate mortgage and swap rates is now more than three per cent, standing at 3.15 per cent currently.

This is despite two year swap rates falling from a peak of 2.51 per cent on 11 June to just 2.04 per cent today.

"Fixed rate mortgages are continuing to be in high demand as any future bank base rate changes should only be an upward movement," said Louis Kaszczak, head of Moneyfacts.co.uk.

"The closer we get to a position where sentiment is stronger that base rate will be going up, the likelihood is that fixed rate deals will follow suit and become more expensive.

"While the average rates are rising quickly, the good news is that there are still currently 42 two year fixed rate deals under four per cent. But customers might need to act fast before these better deals are sold out."

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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