Further mortgage rate rise announcements could be on the way.
Over one million UK mortgage holders have already been hit by a mortgage rate rise and home-owners are being warned to review their mortgage offer as more increases could be on the way.
With mortgage rates having sat at records lows for a couple of years, it was perhaps inevitable that at some point a mortgage rate rise would happen.
Mortgage holders experienced plummeting rates after the credit crisis. Those lucky enough to have had a sufficient deposit allowing them to buy in the last 3 years, perhaps will not remember times when average rates were much higher.
The BoE base rate is sitting at 0.5% with no plans of an increase anytime soon and so many are wondering why lenders are choosing to increase their rates. Some are even accusing lenders or profiteering – however lenders are being truthful when they say their costs are increasing.
Inter-bank funding costs are rising and more banks and building societies could increase their SVRs in the next few months.
Mortgage holders with the Nationwide and Cheltenham & Gloucester are for now safe as their SVR terms and conditions prevent them from raising rate levels beyond 2% above BoE base.
Nationwide have however brought in an increased standard variable mortgage rate for new borrowers which does not come with a price guarantee.
Mortgage rates have begun to climb and those worried about their lender bringing in a mortgage rate rise, are recommended to contact Deal Direct to compare lenders offers.
