Borrowers should fix their mortgage now
Homeowners on a lender’s SVR could save up to £4,649 by switching to HSBC’s 2-year fix at 1.49%, while this includes a £995 arrangement fee.
However if the Bank opted to raise the base rate by 0.50% this saving could rise to £5,705 over two years.
Dan Plant, editor-in-chief at MoneySuperMarket, said: “We know that a base rate rise is on the horizon, and while this may not be until next year, homeowners need to urgently consider their mortgage options while interest rates remain low.
“If you are already on your lenders SVR, or within six months of your current deal ending, don’t dawdle before starting your research.
“The minute base rate rises – and possibly even before – lenders will increase rates too, resulting in an increase in mortgage payments.
“If you want stability for your outgoings, fixing is the only way to protect against future rate rises.”
Customers wishing to stay with their lender can similarly save thousands of pounds.
Santander customers can save up to £4,357 in two years by switching from the lender’s SVR of 4.79% to its 2-year fix of 1.94%, as monthly mortgage payments would decrease from £854 to £631.
Plant added: “Those who feel they are sitting pretty on their provider’s SVR need to start planning ahead to avoid a harsh landing.
“We have been in a low rate period for some time now, and many homeowners may not have previously experienced a rising rate market – they should prepare now to avoid a serious shock in the near future.”