Fixed-rate mortgages at a ten year high

Many people would have been burying their head in the sand when it comes to the state of the mortgage market, and many will be shocked to learn that fixed-rate mortgages are now at a ten year high. All the big lenders are now following each other and putting up a range of their mortgages, with fixed-rate terms being at the top of their list.

Moneyfacts.co.uk, have launched some new figures and the results are very interesting. On average two-year fixed-rate mortgages are now set at 6.75 per cent, the average cost of a five-year fixed term mortgage has increased to 6.72 per cent. Many customers will now be moaning that they now have to pay much more on their monthly payments, but Darren Cook, Moneyfacts mortgage expert has said that “consumers are paying the price for the vast sums lenders now have to pay in order to secure funds.”

Cook has also warned that the situation is likely to get worse before it shows signs of improvement. He also said that while a fixed-rate mortgage seems more appealing than that of a variable rate given the UK’s current financial situation, these types of loans might just prove too expensive for some customers.

That said most customers will want to fix their mortgages, as there are no signs of the mortgage market recovering any time soon. My Brother took out a five-year fixed rate a little over a year ago; he did not think that he made the right choice back then. Now if you take a look at how the credit crisis is taking hold of the UK, he is now thankful that he did.

Source