Mortgage rates are on the move, but the direction is confusing.

Mortgage rates are on the move, but confusingly for many existing home-owners and would-be buyers the direction has been both up and down.

With some lenders cutting their mortgage rates and other lenders increasing theirs, those looking for a deal do not know which way to turn.

Should you fix as rates are on the up or wait to see what will happen as they are coming down?

The BoE have left the base rate at 0.5% for another month which means it has not moved for 39 consecutive months, however currently base rate movement has very little impact on mortgage rates. Better indicators are the Libor which affects tracker rates and swap rates which affect fixed rates.

Several lenders in response to increased funding costs raised their standard variable rates back in May.

However a recent fall in swap rates has led to a reduction in some lenders fixed mortgage rates. Barclays and Northern Rock have cut their fixed rates by as much as 0.2% and Nationwide cut its 5 year fixed rates by 0.1%

Confusingly however other lenders have chosen to raise their fixed rates. The Post Office has increased its 5 year rate which has gone up by a massive 0.4% from 3.59% to 3.99%, followed by ING and N&P who have increased their rates by up to 0.35%.

In light of recent mortgage market developments is it a good time to fix or should you wait and see?

The general mortgage trend has been for an increase to rates and with continued eurozone unrest, the outlook for mortgage rates remains uncertain. However lenders funding costs are still increasing which provides them with the justification to increase mortgage rates further.

If you are considering fixing a rate a significant fall is unlikely in the short term, therefore you may want to source a competitive rate now rather than risk missing out.

Contact Deal Direct now for a competitive quote.