The Bank is expected to double its base rate to 0.5 percent to combat rising inflation. Financial comparison group Moneyfacts says that if lenders pass on the rate hike in full, annual repayments for a 25-year £200,000 standard variable rate mortgage will soar by £687 to £13,904.64. The average standard variable rate mortgage is 4.41 percent and experts predict the Bank will raise its base rate four times this year.
Moneyfacts’ Eleanor Williams said the time was right for borrowers to look at locking into a fixed-rate deal.
She said: “Currently the difference between the average standard variable rate and the average two-year fixed rate is around two percentage points, so borrowers might be able to make a significant monthly saving by moving off a standard variable rate to a fixed-rate deal.
“Considering that household budgets are being tightly squeezed from various angles at the moment, this could make a substantial difference to monthly expenditure.”
