Lenders 'failing to cut fixed rates'

Today the average two-year fixed rate is 6.13%, compared with two-year swap rate at just 3.61%. Before the credit crunch, the difference was just 0.10%. Although a bigger margin for risk is understandable, Moneyfacts says a 2.52% difference seems excessive. Analyst Michelle Slade says the average rate on fixed rate mortgages over the past few months has remained almost constant, despite the funding cost to lenders reducing significantly. "Since the cut in base rate, the average fixed rate has dropped slightly but nowhere near the amount we would expect," she says. "Even allowing for...