Lender after lender has withdrawn their fixed rate mortgages over the course of the last couple of weeks, only to replace them with higher rates. The trend continues this week with HSBC and Woolwich the latest lenders to hike their fixed rate mortgages.
High inflation figures have sparked speculation that the Bank of England will need to lift Base rate sooner than previously anticipated. Many borrowers will have been expecting Base rate to rise and been considering whether to fix their mortgage now or stick with their low variable rate.
Although forecasts are that rates could rise sooner there is still little to suggest they will rocket upwards. However the more immediate impact has been on the fixed rate deals available – many of the major mortgage lenders have already made some changes and others are sure to follow this week.
Borrowers that have been sitting on their hands may be provoked to take action as the sharpest rates continue to disappear. Certainly, borrowers that are worried about how they will cope with higher interest rates should now seriously consider remortgaging to seek the shelter of a fixed rate.
Others enjoying a low tracker rate may prefer to hold on but should do so on the understanding that the very cheapest fixed rates will already have moved on.