Rising mortgage rates?

In an attempt to prevent mortgage rate increases, the BoE is trying to re-assure the market that the interest rate WILL remain at 0.5% over the medium term.

Despite indications that interest rates will remain static for roughly the next three years, interbank lending rates have increased which has led to predictions of increased mortgage rates.

In reaction to this, and to ensure property market price increases and mortgage lending continue at present levels, the BoE Governor has advised that by communicating with both market participants AND households the Bank is sending a clear signal that interest rates are not going to imminently rise.

The BoE governor Mark Carney has indicated that the base rate would be kept at 0.5% until UK unemployment drops below 7%, that is unless the rate of inflation spikes which is something that could happen. In addition the Bank has also said it is prepared to add a QE easing program while unemployment remains above 7%.

For those looking to re-mortgage or buy a new home there is a dilemma. Do you take the risk that mortgage rates will remain low or do you act and find a cheap deal to avoid the likelihood of increasing rates?

While re-assurances have been made that the interest rate will remain at 0.5%, there is no guarantee.The rate of inflation could spike which would mean that the Bank would need to act and increase interest rates, mortgage rates could then rocket. In light of all the information mortgage market experts are predicting increases and are recommending fixing a deal now.

If you would like advice as to which mortgage type and length term would best suit your needs, you are advised to call Deal Direct on 0800 048 8828.

As an independent broker we work solely on your behalf and in your interest to find the best deal on offer. As we are independent our advice is impartial and based on your needs and not that of any lender.

For the cheapest mortgage rates market-wide,

call 0800 048 8828.