Fixed-rate mortgages hit eight-year high

Updated 12.02 Wed Jul 09 2008
Keywords: high, Bank of England, Fixed rate, mortgages

The cost of a fixed-rate mortgage has soared to an eight-and-a-half year high, the Bank of England has said.

Official figures show that lenders have continued to hike their rates in the face of higher funding costs.

The cost of three-year and five-year fixed-rate deals also rose sharply on the back of strong increases in swap rates, upon which the loans are based

Average interest rates on a two-year fixed rate loan for someone borrowing 75 per cent of their home's value jumped by 0.37 per cent during June to stand at 6.63 per cent - the highest level since February 2000, according to the Bank of England.

The cost of three-year and five-year fixed-rate deals also rose sharply on the back of strong increases in swap rates, upon which the loans are based.

But for the second month running there were no figures quoted for two-year fixed-rate mortgages for people with just a 5 per cent deposit due to the Bank having insufficient data on these deals.

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