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Millions of mortgage bills rise today as base rate changes take effect

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  • 01/12/2017
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Millions of mortgage bills rise today as base rate changes take effect
Millions of homeowners have woken up to higher mortgage bills, as a spate of rate hikes linked to last month’s increase to the Bank of England base rate take effect.

Barclays, HSBC, Santander, TSB and Yorkshire Building Society are among the lenders that today raised their Standard Variable Rate (SVR) by 0.25% to coincide with the start of December.

However, fixed mortgages remain competitive, with a number of lenders this week cutting rates or launching new deals.

Virgin has reduced rates on its two-year fix at 95% loan to value (LTV) to 4.09%, while Post Office Money has launched a 1.48% two-year fix at 75% LTV.

Halifax and Principality have all also chopped fixed rates in recent days.

Andrew Montlake, director at broker Coreco, said: “There are many more lenders offering competitive remortgage deals, fees free options or product transfers that will allow people to secure their monthly mortgage payments and in many cases reduce them further.

“It is important to get proper advice around this as it may be that due to the low rates your mortgage term could be shortened, or perhaps an offset mortgage may now be suitable that will further help to repay the mortgage loan quicker.”

 

FTB focus

Lenders appear to be particularly focused on first-time buyers, after stamp duty for aspiring homeowners was cut in last week’s Budget, with Barclays and Yorkshire Building Society both launching new 95% LTV deals over the past seven days.

Rachel Springall from Moneyfacts said: “It’s great to see a selection of providers dropping their rates and improving their incentives to entice new borrowers.

“There may well be those who are on a standard variable rate or tracker rate and are actively looking to switch because of the base rate rise, so it’s a good opportunity for them to grab a new fixed deal.”

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