Mortgage rates inching up
The price comparison website evidenced its statement by pointing to First Direct, whose 2-year fix rose from 1.49% a matter of weeks ago to 1.69%
Dan Plant, consumer expert at MoneySuperMarket said: “The recent rate rise speculation is starting to make providers cautious, and this is being reflected in their offers.
“We know choosing a mortgage can be confusing but if people can do it now, they avoid the risk of rates rising over the next few months. Many lenders allow mortgage holders to reserve rates available now for up to six months for a small fee, so even those who still have some time left on their current deal can benefit.”
Oddly the typical 60% LTV rate has risen to 2.23%, making it cheaper to opt for a typical 65% LTV mortgage at 2.08%.
Currently a YBS customer borrowing £150,000 over 25 years at 65% LTV (1.07% with a £1,545 fee) would pay less than on the Post Office’s 2-year fix (1.05% with £1,995 fee).
Plant added: “It’s prime time for those looking for a mortgage as there are still some great deals on the market – even if it’s a bit bizarre that you can currently get a cheaper deal with a smaller deposit. However,
“As always, prospective buyers need to think about the long term and work out the total cost of the mortgage, including both rates and fees, before committing to a deal.
“While 65% LTV mortgages are better than the 60% LTV deals at the moment, consumers should be wary of a rate rise and make sure they can afford the repayments if they suddenly shoot up, should they choose a variable rate mortgage.”