For anyone buying, remortgaging, or end of fixed rate switching, you should be aware that lenders have been putting up their interest rates more quickly than the Bank of England. So what's going on??
The reason for this is that lenders mostly fund mortgages by external borrowing using what's called 'swap rates'. So they buy the money in at one rate and lend it out at that rate plus a margin.
To show whats going on at the moment, a 2 Year swap rate is currently around 2.374%, but in July 2021 it was 0.049%. Swap rates are based off current assumptions,so factors like inflation,the conflict in Ukraine, prices, fuel, gas prices and the general economy, will feed into where those forecasts come from.
So it's more important than ever to get the correct advice on your new or existing mortgage rates. Give us a call and we'll guide you!