The writing really does seem to be on the wall for the tracker mortgage. Most of us have really enjoyed the period of plummeting interest rates and repayments. I even admit to being a little gleeful at times, but all good things must come to an end. And it seems most borrowers are recognizing that this particular joy is very close to having run its course.
Figures from Legal & General show 87% of residential borrowers went for certainty when picking their home loan, up from 71% in the first three months of this year. The reason for this is likely to be the fact that people now view an interest rate hike early next year as inevitable.
In terms of which fixed deal people are choosing, two year terms seem to be the most popular and that probably reflects people’s uncertainty about the economic times. Three year fixes are also showing a huge amount of appeal.
It has to be said that people thinking of fixing a mortgage need to get moving on it because the banks are moving like lightening to hike up their fix rate terms. Nationwide increased their rates again this week, making it the second time in under two weeks. You can rest assured the banks have not enjoyed this period of low interest rates and will be keen to get them back up where they believe they belong.
Now is the time to fix if it is something you are thinking about.
