Lenders latest mortgage rates remain competitive but for how long?
The current advice is, move now to a new deal while the lenders latest mortgage rates remain competitive.
Brokers are warning those borrowers planning to buy their first home or move house in 2012 to secure mortgage agreements from banks now, to avoid being hit by rising rates later in the year. At the moment there are still some good deals to be had, for example the Chelsea recently launched Britain's cheapest 5 year mortgage at 3.19 per cent.
Although economists predict that the BOE base rate will remain at 0.5 per cent for at least another 2 years, swap rates are being pushed up by the eurozone crisis and eventually this will filter through to borrowers in the form of a mortgage rate rise. Recently, the Woolwich and Nationwide increased their latest mortgage rates by 0.2 percent, and soon after NatWest, Santander and Halifax followed suit. Back in July 2011, the cheapest lifetime tracker from ING was base rate plus 1.89 per cent, the cheapest equivalent now available is from HSBC which is base rate plus 1.99 per cent.
Fees are soaring too. Over the last year charges for setting up a mortgage have risen by around two thirds making the average arrangement fee £1498. Anyone considering a property purchase in 2012 could benefit from starting their search for finance soon. In general mortgage offers are valid for up to six months and if a better one appears during the property search then it is easy to swap. If lenders latest mortgage rates rise as expected, borrowers securing an offer in principle now could potentially save themselves thousands.
