Mortgage rates 'climbing'

Posted: 24 Sep 2008 13:38:01 GMT

Homeowners have been urged to secure cheap mortgages while they still can.

Consumer advice website Fool.co.uk warned this week that financial swap rates have climbed back up beyond six per cent, having taken the previous six months to fall to 5.7 per cent.

It explained that the slight decline in the London Interbank Offered Rate (Libor) during March had benefited homeowners by bringing about a subsequent decline in standard variable rates (SVR), but cautioned that these could rise in response to the latest changes.

David Kuo, head of personal finance at the website, explained that Libor is a more accurate guide to the costs of fixed-rate and SVR mortgages than the Bank of England base rate.

"We therefore urge anyone whose fixed-rate mortgage deal is about to come to an end to apply for a new one without delay. Most lenders will let you to arrange a new mortgage up to six months before you need it," he advised.

Meanwhile, research from the Co-operative Bank has revealed that the average first-time buyer feels they need to have saved nearly £20,000 before they are able to buy a property.

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