Fixed mortgage rates set to rise, says first direct

Date:Wednesday 24th November 2010
Author: Max Freedman

A source from first direct has predicted that interest rates on fixed mortgages may start to move up again in 2011.

Senior mortgage product manager at the firm Richard Tolchard suggested this potential change will not have escaped the attention of some borrowers.

"The canny homeowner has realised that Britain has been at the bottom of the interest rate cycle for a while," he said.

Mr Tolchard urged borrowers on tracker deals to make sure they are locked into an arrangement that will allow them to switch to a fixed rate easily.

He highlighted the importance of signing up for a home finance agreement that will allow customers to make this alteration without incurring penalties.

Recent research by first direct showed just one in four of the mortgages agreed by the firm in 2010 have featured a fixed interest rate.

Last week, the company published a study indicating Britons are wasting more than £2,000 each year on average by failing to plan ahead on purchases such as train tickets and petrol.