While last week saw the Bank of England keep rates on hold, it looks increasingly likely that an increase could occur in the spring.
According to the Bank of England's monetary policy committee: "monetary policy would need to be tightened earlier and by a somewhat greater extent" than had previously been indicated.
Late 2017's rate rise was the first in a decade, which raised the spectre of increases in mortgage rates. Ray Boulger of mortgage broker John Charcol predicts that at least two, if not three rate rises could occur this year.
The swap rate, which is the wholesale cost of borrowing has increased in the recent past, with the two and five year swap rates increasing markedly. The two year has increased from 0.39% to 0.99%, with the five year increasing from 0.44% to 1.43%.
Fixed rates are expected to remain low in the near term however, due to competition between lenders.
For variable mortgages, rates are determined by the swap rate. The swap rate is the rate at which lenders can access credit to pass on to borrowers. This rate varies and has a major impact on mortgage rates.
It's important to be aware of the likely impending rate rises when making a decision as to which mortgage is right for you.
Are you thinking of making a move this year? Our Mortgage team here at Westminster Wealth can ensure that you receive the most suitable mortgage for your personal circumstances, needs and objectives. Contact us today.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Our charges are usually between £395 and £995 depending on the type and amount of borrowing required and individual circumstances.
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