The average of the keenest low LTV 2- and 5-year remortgage rates from the top ten lenders has continued to escalate this year, both well above 2.00% at 2.36% and 2.46% respectively, having risen from the historic lows of 0.89% and 1.05% respectively last October.
L&C’s remortgage tracker shows that the monthly payment on a typical £150,000 repayment mortgage is now more than £100 higher than at the low, pushing annual mortgage payments up by more than £1200 p.a.
However, recent base rate rises have been feeding through to lender standard variable rates too. The average of the top ten lender reversionary rates at the beginning of May was 4.34% and the Bank of England's rate increase last week will see rates continue to rise.
Mortgage rates continue to change frequently as lenders are forced to constantly adjust and increase their rates in a fast paced market, often re-pricing on a weekly basis. Customers therefore have to move quickly to take advantage of the best rates on offer before they disappear.
David Hollingworth, associate director at L&C Mortgages said:
“The market is moving at breakneck speed as lenders try to manage their product ranges and lending volume, often resulting in products lasting days rather than weeks. That presents a real challenge for borrowers trying to keep on top of market movements but with continuing increases in mortgage rates it’s all the more important for borrowers to keep a tight rein on their mortgage.
There are still impressive savings to be made over lender variable rates and those could grow as base rate looks set to continue on an upward trajectory. Cutting the mortgage rate could help deal with higher living costs and build in security against further interest rate rises. However, increasing outgoings are also likely to feed into lender affordability criteria, so borrowers should seek help in pinpointing the best deal.”
