Bank Base Stable, For Now…

Will mortgage rates rise or fall? This is the biggest question on everyone’s lips.

Last week, the Bank of England’s Monetary Policy Committee announced that the Bank of England Base Rate would remain at 4.25%. The vote was 6-3, with the dissenters voting for a further quarter-point cut.

It is no surprise that the MPC decided to hold firm in the wake of a plethora of contradictory data.

On the one hand, stubborn inflation and the prospect of higher oil and energy prices threaten to rear their heads again, while on the other hand, the economy is still stuttering, and unemployment is starting to rise.

Whilst this will be a blow to many who have been waiting expectantly for rates to fall further, it does seem to be the sensible option at this stage.

It does now seem to be a case of higher rates for longer where interest rates are concerned, and many prospective buyers or mortgage holders who have put their plans on hold in the hope of further cuts will need to make a decision.

The good news for buyers and those looking to remortgage is that we can secure a product now, which we highly recommend, and then review the market before completion to see if anything better has indeed come along.

Mortgage lenders have not quite reacted one way or the other yet, maintaining the status quo. We suspect we will see lenders cut some rates, repricing upwards when they have enough business, and then repeating this process.

Whilst no one lender will be dominant, the good news is lenders’ lending targets are still strong and the competitive pressure will help to keep rates at the lower end of the spectrum.

Best Mortgage Rates

In terms of mortgage rates, for standard residential mortgages, borrowers can obtain 2-year fixes at 3.75% (6.70% APRC) and 5-year fixes from 3.95%, (6.00% APRC), whilst variable discounted rates are around from 4.19%, (5.90% APRC) and variable tracker rates from 4.36% (7.40%).

Those looking at Buy-To-Let can now obtain products from 2.79% (7.70% APRC) for a 2-year fixed, 4.52% (7.50% APRC) for a 2-year tracker, or 5-year fixes from 3.61% (4.00% APRC).

Contact

To speak to one of our friendly, down-to-earth advisers, please call us on 020 7220 5110 or click here. We look forward to chatting with you.

Important

Your home may be repossessed if you do not keep up repayments on your mortgage. There may be a fee for mortgage advice. The actual amount you pay will depend on your circumstances. The fee is up to 1%, but a typical fee is 0.3% of the amount borrowed.