Indications of an earlier than expected rate rise were once again the focus of this weekend’s financial press, with experts in the Independent on Sunday and the Sunday Telegraph urging borrowers not to be complacent. A number of lenders have already increased their fixed rates over the last week, a trend which is set to continue, but competitive deals are still available so homeowners need to act now.
The Sunday Times reported that around 3 million borrowers have taken advantage of rock-bottom rates by overpaying on their mortgage. Experts warned however that when base rate does rise, many lenders will automatically recalculate payments to fit the stated mortgage term, so customers could find they are offered a reduction in payments. Experts recommended keeping payments as they are rather than accepting the reduction, to avoid paying more interest in the longer term.