Now more fixed-rate mortgages applied due to rising interest rates

13/03/2007

This information has been put forward by the Council of Mortgage Lenders (CML) and they have stated that first-time buyers are applying for fixed-rate loans.

In January over 85 per cent of first-time buyers applied for a fixed-rate mortgage, this was the highest figure by CML since the last 12 months – further more another 70 per cent of home movers choose the fixed-rate mortgage.

CML director, Michael Coogan stated, "Increasing numbers of people - especially first-time buyers - are opting for a fixed-rate mortgage. "

He added, "Each month it seems that the prospect of another interest rate rise is balanced on a knife edge. More and more borrowers are protecting themselves against this risk and choosing the certainty of fixing their monthly mortgage payments, which allows them to plan ahead with confidence."

In January all new home loans were up to 72 per cent and these were all fixed-rate mortgages. This was the greatest conclusion in 1 year and up from 69 per cent Decemeber period.

Comparing January with Decemeber there was a 11 per cent decrease in the number of mortgages taken out by people. However December being low, 6 per cent extra mortgages were applied for by home movers than in the current month last year.

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