It has been interesting to note the current rise in SWAP rates on the money markets, (the future cost of funds that lenders base their fixed rates on), based on the fact that we have seen some more promising economic data and that there has been some talk of an earlier than expected rate rise from the Bank of England.
Whilst some are mooting the possibility of a Spring rise, it still seems more likely that any move will be at the end of the year rather than the beginning.
Even with this rise in costs, the rampant competition between lenders means that we are still seeing rate cuts rather than increases, from lenders desperate for a good start. A number of leading lights have made an early statement such as Barclays, Santander and Bank of Ireland.
Some lenders will be disappointed as they struggle to make the impact they hope for. Rate alone is not enough these days, service is key, but criteria will make all the difference. There are still many borrowers who believe they will struggle whether it is due to affordability and stress testing, the nature of their work and income, age, interest only requirements and such like.
Whilst more needs to be done, the good news is that there is now more choice and we are finding we can help even more people, especially those who do not believe they could get what they really wanted.
At present, 2-year fixes are available at 1.19%, (3.78% APRC) and 5-year fixes from 1.74%, (3.21% APRC) whilst variable tracker rates are around from 1.24%, (3.56% APRC).
Those looking at a Buy-To-Let can still obtain products from just 1.34%, (4.66% APRC) for a 2-year fix.