BoE warns UK mortgage rates are increasing.
Mortgage rates have increased and the fear is rates could be set to rise even further. Sir Mervyn King, Governor of the Bank of England has recently warned that UK borrowers may soon face much higher interest rates.
Since the end of 2012 UK mortgage lenders have closely monitored their mortgage approval levels by restricting lending criteria and increasing mortgage rates. This is making it more difficult for both new borrowers and home-owners to source competitive rates.
Recent news has been filled with reports of home-owners being hit by lenders SVR hikes, and now average mortgage rates are reportedly also on the increase.
UK banks and building societies advise that the need for increased rates stems from the eurocrisis, which has led to a rise in funding costs. Lloyds has already announced that it intends to reduce its mortgage market share in 2012.
Those with a larger deposit are still able source competitive mortgage rates, however those who are not in this position are finding it is more difficult to borrow as lending criteria tightens.
Demand for mortgages remains high, but deals are only on offer for a limited time before fixed funding is exhausted. This when combined with increasing mortgage rates, means it is now more difficult than ever to source and be approved for a deal.
Would-be home buyers are advised to contact Deal Direct for advice. We can make a full review of all options available and can search the entire mortgage market for a competitive deal for you.
