Average two-year mortgage rate rises above 6%

Lenders have been withdrawing and re-pricing deals rapidly amid interest rate fears.

The average mortgage rate for a two-year fixed deal has risen above 6% for the first time since December.

Lenders have been withdrawing and re-pricing deals rapidly – there are 240 fewer residential mortgage products on Monday compared with Friday.

The average five-year fixed rate mortgage has increased to 5.67%.

The last time rates were this high was in December after the market was sent plummeting following Liz Truss and Kwasi Kwarteng’s mini-budget.

The two-year rate peaked at 6.65% in October before falling to below 6% in the last month of the year.

The buy-to-let sector has been even more volatile – with the fixed rate rising to 6.3% on Monday, according to financial information company Moneyfacts.

Prime Minister Rishi Sunak said there will not be any extra help given to people who are struggling with mortgage payments.

It comes as the squeeze on mortgage holders is set to tighten as the Bank of England gets ready to hike interest rates for the 13th time in a row, experts have said.

Some analysts are expecting UK interest rates to rise by another 0.25 percentage points on Thursday and say there could be more increases on the horizon.

It would take the rate to 4.75%, helping to drive the cost of borrowing and hitting more than a million mortgage holders whose fixed-rate deals are due to expire soon.

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