Homeowners advised to secure fixed-rate mortgages

Date:Monday 15th June 2009
Author: Susanna Kavka

A price comparison site has advised consumers to enter into fixed-rate mortgages as soon as possible.

According to moneysupermarket.com, although the cost of such home loans has been falling for nearly two years, it is about to rise.

It suggested that as the economy begins to recover and the Bank of England starts to raise the country's base rate of interest, lenders will up the rates they charge on fixed-rate mortgages.

Head of mortgages at moneysupermarket.com Louise Cuming said: "Borrowers looking to fix should lock in quickly, before the next tranche of mortgage products come through showing drastically increased rates.

"Borrowers might also consider fixing for a longer period of time, say up to five years."

She added that if the base rate climbs back up to the levels it was at in the middle of last year, fixed-rate deals may be increasing in cost for some time.

Recently, the Council of Mortgage Lenders suggested that fixed-rate home loans have been increasing in popularity, with 69 per cent of borrowers taking out such loans in April of this year.