The rate rise has started

The Sunday Times has reported that there are now clear signs that the ongoing turmoil in the Eurozone is starting to push up mortgage rates.

Private banks, which often lead the high street banks by several weeks, have started to increase rates for the first time in more than two years.

Mortgage borrowers, particularly those who are on their lender's base lending rate ( Standard Variable Rate) and have been so for some time, are therefore encouraged to take pro-active rather than re-active action so that they do not get caught out further down the line.

Money market rates, which are used by lenders to fund deals, have also been creeping up despite last week's co-ordinated effort by central banks to ease pressure in the lending markets.

The three-month inter-bank rate, or Libor, which is used to fund variable-rate deals, rose to its highest level since July 2009, while five-year swap rates, used to fund fixed-rate deals, rose from 1.61% to 1.71% last week after being on a downward trend since February.

If you are an existing mortgage holder and have any concerns about the effect the above might have on your future budget/ finances , do feel free to get in touch.

As always , thanks for your attention.

Mark (mark@themortgagemonkey.co.uk)