News today from the Office for National Statistics shows that UK house prices rose 10% in the year to November 2021, up from 9.8% in the year to October.
The cost of an average home was £271,000 in November, up from £246,000 compared to 12 months earlier.
This price hike comes at a time when mortgage rates are rising slightly after the Bank of England hiked interest rates from 0.1% to 0.25% in December.
Lenders, including Nationwide and Santander, said they are reflecting the increase by raising the cost of bank-linked mortgages and their standard variable rate (SVR) on loans by 0.15% effective February 1, 2022.
Nationwide’s base mortgage rate (BMR) and standard mortgage rate (SMR) will rise 0.15% to 2.25% and 3.74%, respectively, while Santander’s follow-on rate, which will apply at the end of its base-rate tracker deals, will rise will rise 3.5%. His standard variable rate will rise to 4.49%.
Many new fixed income deals had already factored in the rate hike, although more rate hikes were likely to come. Yesterday, Nationwide increased the cost of two-, three- and five-year fixed rate contracts.
Why are interest rates rising?
The Bank of England’s Monetary Policy Committee (MPC) remains under pressure to cool the economy and curb rising inflation.
The Consumer Price Index (CPI) rose 5.4% in the 12 months to December 2021, marking its highest level in three decades.
It is feared to rise further in April 2022 when the energy price cap rises by up to 50%, leading to higher energy bills for millions of UK households.
What are mortgage rates today?
But with so many things to keep track of and mortgage rates that often change on a daily basis, how can you stay current? One easy way is to use our mortgage spreadsheets, powered by Trussle – a trusted mortgage broker and our mortgage partner.
To find out what offers are available at today’s rates for the type of mortgage you are looking for, you need to enter your personal criteria in the table below. Here’s what to do:
- Choose whether to mortgage finance a home purchase or if there is one rescheduling for an existing property
- Enter the property value and the mortgage amount you need. This automatically generates a percentage called the “loan to value.” The lower your LTV, the cheaper the mortgage rates available
- Tick the appropriate box if it is a Buy-to-let or interest rate mortgage (You need a repayment strategy for these deals) or if you are looking for a mortgage to a shared ownership property
- Finally, filter your search by type of mortgage For example, you might want a two-year or five-year fix or tracker. The filter is set to a total mortgage term of 25 years, but you can change this if necessary.
What else should I know?
Mortgage offers with the cheapest interest rates usually come with fees. You can either pay these in advance or add them to the loan. To account for the cost of the fee, order the results by Initial Period Cost (in the Sort By drop-down list).
Alternatively, you can rank the results by initial rate, lowest fee, or monthly repayment – even by the lender’s “following rate” that the deal reverts to at maturity.
While mortgage rates change daily, the cheapest are reserved for larger deposit amounts, typically 60% of the property’s value or more. And in all cases, you need sufficient income and good credit to be accepted for a mortgage.
If you want to see what your monthly mortgage payments might look like in different scenarios while overlaid with household bills, our mortgage calculator calculates the totals.
While Trussle lists around 12,000 mortgage deals from 90 lenders — which makes up the vast majority of the market — occasionally some deals are exclusively available through a handful of brokers, so you might not see them listed.
When can I start a debt restructuring?
Mortgage offers from the major lenders typically have a six-month term (as detailed in our Best Lenders For Remortgaging), although some lenders limit the expiration date to three months. It pays to look for a new mortgage deal that far in advance because you can lock in an interest rate like what you see today – for free and with no strings attached.