The Bank of England recently continued to hold it’s base rate at 0.5% which it has done consistantly now for the last 18 months, a situation unprecedented in recent times. Against this backdrop there have been increasing signs that interest rates may have to rise in 2011.
This means that many borrowers currently on a penalty-free Tracker mortgage, their lender’s standard mortgage rate (SVR) or shortly to move onto this have a dilemma, do you opt for a fixed rate mortgage now and take advantage of the very low fixed rate deals available, or do you wait a little longer?
One factor is the current interest rate you are paying. Lenders currently have SVR’s which vary from 2.5% to almost 6% and some of the existing Tracker deals are less than 2% so the rate you are paying will influence at what point you fix.
The issue is obviously one about timing. There’s no point in delaying until interest rates actually do rise, because the current crop of Fixed rate products will almost certainly become more expensive. The trick will be to take the plunge just before that event, and that will be down to a mixture of luck and good judgement.
But that time appears to be drawing ever closer and certainly 2011 seems to be the year that this will happen.
If you’d like to chat about your personal situation in the meantime, give me a call at Pink Residential, the online estate agent, to speak to me, Jim Pearce, maps.