Looking for a mortgage? It’s time to get a move on

theguardian.com:

Homebuyers and those looking to remortgage were this week being urged to act fast if they want to lock in a competitive home loan deal.

Many banks and building societies have been pulling their mortgage deals or repricing them upwards, often at very short notice, as they grapple with rising interest rates and inflation, and the wider economic volatility.

Many economists reckon the news this week that inflation has hit 7% puts more pressure on the Bank of England to hike interest rates rapidly. But at the same time, some odd things going on with fixed-rate mortgage pricing suggest some lenders think a sharp economic slowdown may be coming down the tracks that means the Bank would need to stop putting interest rates up or even cut them in the future.

That could leave some people on the hunt for a fixed-rate mortgage facing a dilemma: do you sign up for a longer-term fix – five or even 10 years – on the basis that this will protect you from the economic “storms” for longer, or do you go for a shorter-term deal – two years, say – so you are free to hop on to another loan if rates drop in maybe two years? Ultimately it will be down to individual circumstances and things such as how tight your finances are.

What’s not in doubt is that many mortgage deals are getting pricier, and lenders are also starting to tighten their affordability tests because of the cost of living crisis, which may mean some borrowers can’t borrow as much as they would like – so that’s two reasons why it’s a good idea to act speedily if you can.

Financial data provider Moneyfacts this week said the average two-year fixed-rate mortgage on sale in April was priced at 2.86% – up from 2.65% in March, and the highest figure since 2015. Meanwhile, the average