Sub 4% mortgage deals might not be around long, experts warn as lenders start to hike rates on fixed-term deals
High street banks and building societies have started to increase rates on fixed-term mortgage deals again as experts warn that offers below 4 pc could soon disappear.
Rates had been falling since October, when five-year deals hit a 14-year high of 6.51 per cent, according to analyst Moneyfacts.
Last month, several lenders including HSBC and the Co-op launched five-year deals below 4 per cent for the first time since the autumn.
Bottoming out? Mortgage rates had been falling since October, when five-year deals hit 6.51% , but experts warn buyers should act quickly before the best offers are pulled
But rates have started to turn again, with experts warning buyers should act quickly before the best offers are pulled.
David Hollingworth, a broker at L&C, says: ‘These are significantly better deals than a few months ago but buyers should not keep waiting for rates to fall further.’
HSBC was the first lender to lower its rates below 4 per cent in February but has today increased its five-year remortgage rate by 0.05 percentage points to 3.99 per cent.
And on Friday Yorkshire Bank hiked several of its fixed rates by up to 0.1 percentage points, with deals now starting at 4.48 per cent.
Platform, an intermediary of the Co-operative Bank, also withdrew its entire mortgage range last week as it was overwhelmed by customer demand.
A fortnight ago the lender launched a five-year rate at 3.75 per cent for those with a 60 per cent stake in their property — the most competitive rate on offer.
A spokesman says it expects to reintroduce mortgage deals next week.
The cost for banks to borrow money to lend to homeowners, known as the ‘swap rate’, has been rising over the last week, making it less affordable for lenders to offer mortgages at competitive rates.
The Bank of England is expected to hike its base rate again later this month which could further drive up the cost of borrowing.