Fixed rate mortgages continue to rise despite the latest interest rate cut

The average fixed-rate mortgage is higher than last month, despite December’s interest rate cut, according to moneysupermarket.com.

More than 7 out of 10 of all new mortgages being taken out are fixed-rate- a figure sure to upset the government since only last week the PM condemned lenders’ lack of action on SVRs.

In early December, the fixed-rate average was 7.30%. Today it stands at 7.31% rather than the 7.05% the government had really wished for.

Any potential borrowers with a first class credit score could find themselves a deal with a fixed-rate at 0.39 less than last month, however for the vast majority of borrowers, the harsh reality is that they can certainly expect to pay more this time around.

Head of mortgages at moneysupermarket.com comments that unless you fit all the criteria to make you a low-risk borrower, then you are destined to pay more . This realisation comes AFTER an interest rate cut, so goodness knows what the situation would have been without the cut.

There will be homeowners who have waited until after the cut to secure a new deal from themselves. Unfortunately they will be disappointed and still out of pocket for the most part.