Borrowers have benefited from low lending rates thanks to the Bank of England’s base rate remaining at 0.5 per cent but the tide has started to turn, according to MoneySuperMarket.
Analysis from the price comparison website found that rates are already beginning to rise on some mortgages, ahead of the predicted rise in the base rate next year.
Anyone, looking to re-mortgage or who is currently paying their lender’s standard variable rate, should therefore consider their options now before the cost of borrowing rises further.
While mortgage rates are still lower than pre-credit crunch levels but are steadily rising. Average two-year tracker rates are currently 2.79 per cent, 0.29 percentage points higher than in February 2013.
For fixed mortgages, average rates on two and three-year fixed rate mortgages have also noticeably increased compared to last year, with a current rate of 3.62 per cent for a two-year fix, and 3.97 per cent for a three-year fix – and are respectively just 0.17 and 0.55 percentage points lower than March 2009 levels.
Clare Francis, editor-in-chief at MoneySuperMarket, said: “The low base rate is still good news for borrowers as mortgages continue to look extremely good value. However, they’ve already started to nudge upwards and with interest rate rises seeming likely from next year, homeowners should try and make the most of this whilst they still can.
“Millions of people are currently paying their lender’s SVR and these rates will start rising when base rate goes up, so now is the time to consider moving onto an alternative mortgage. Fixed rate deals are hugely popular at the moment as borrowers seek to protect themselves from rate increases.
“For those with money to spare each month, now is also a good time to overpay on your mortgage. Reducing the size of your debt will be beneficial in the long run when rates go up –which they will.”
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