Many of us are benefiting from the decrease in interest rates which have fallen consistently from 6.25% in 1998 to 0.25% in 2016. Low rates have meant lower borrowing costs and smaller monthly mortgage repayments.
However, recently there have been suggestions from various market sources to include the Bank of England that Interest rate hikes are on the horizon.
Some market analysts are forecasting one interest rate increase by the yer 2021 however Mark Carney governor of the Bank of England says that Interest rate increases could be “more frequent” than expected if the economy performs as the Bank of England is expecting and “if there is a resolution to the Brexit impasse, and inflation and growth continue to pick-up, then more increases are likely.”
What does it mean for your mortgage?
Moves in interest rates are important to everyone, particularly those people with variable or tracker mortgages, for even a small quarter-point rise can add hundreds of pounds to their annual mortgage costs.
Likewise those who are on fixed rate mortgages need to be aware of when their promotional offer expires and look to switch to a product that is most suited to their circumstances.
If you are in the market for a new home, now is a good time to borrow, as rates are generally low and lenders are offering exceptionally competitive rates, for example most lenders are offering five year fixed deals at around the 2% mark. *
If you would like more information about available mortgage rates, need advice about remortgaging or need support switching products, get in touch with our award winning mortgage brokers on 0208 364 3444 or contact us via our online form.
*Rates of 2.01% -2.08% were available at the time of writing (15.05.19) source Mortgage Brain.