It will be interesting to follow exactly how different lenders will compete.This week, for example, Nationwide is cutting its early repayment charges – axing them completely from two-year tracker deals.
However, it doesn’t look like there is a rush to reduce the actual rates. In fact, they’re creeping up. Other factors are at work, keeping lenders on their toes as they look to both win new business and stay comfortably in the black.
Moneyfacts.co.uk editor Sylvia Waycot summed it up:
“It is a very different mortgage market to four months ago when the Government withdrew its controversial FLS, thereby cutting access to cheap money. Banks are facing scrutiny over balance sheets via stress tests and capital holding requirements, plus there are increased costs of regulation and processes such as MMR.
“Don’t make the mistake of thinking that we need a change to base rate to increase the cost of mortgages, as prices are creeping upwards now. So if fixed rates are your preference, now is the time to fix.”
We watch the mortgage market closely, and love to talk about it. If you have questions about your own financial options, drop us a line.