Homeowners have been urged to fix their mortgage repayments now while rates remain low.
The debt management advice was offered by Alliance & Leicester mortgage director Nici Audhlam-Gardiner, who said that many people may be “reluctant” to commit to a new agreement in the current climate.
But she explained that now is the time to opt for a fixed-rate deal, as prices tend to increase in anticipation of future base rate rises from the Bank of England.
It comes following research from the bank, showing that 81 per cent of borrowers who are presently on their lender’s standard variable rate (SVR) have no plans to look for a better offer.
“Although SVR deals can be favourable for the short term, once interest rates start to rise they can become unaffordable very quickly,” Ms Audhlam-Gardiner stated.
The base rate currently stands at 0.5 per cent, with the Bank of England expected to make an announcement on the figure today (May 7th).
By Jamie Price