The cost of an average two-year fixed rate mortgage has increased by over 60 basis points in the last three months, according to Legal & General.
However, Legal & General’s analysis of 24,000 mortgage applications also revealed large numbers of borrowers have moved to fixed rate deals. The L&G Mortgage Purchase Index found the average two-year fixed rate was 6.51% between March and May 2008, compared with just 5.87% between December 2007 and February 2008, a difference of 64 basis points. Over the same period, five-year fixed rates increased 52 basis points to 6.34% on average, despite the Bank of England cutting base rates in April. Ten-year fixed rates remained stable at 5.97%. Growing uncertainty about the future of interest ra...
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