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Borrowers 'could save with fixed-rate mortgage'
UK homeowners are being urged to consider switching to a fixed-rate mortgage to take advantage of the 0.5 per cent Bank of England base rate.
Around eight out of ten borrowers on a standard variable rate (SVR) mortgage currently have no plans to switch to save money, according to new research by Alliance & Leicester.
A further 264,000 people plan on waiting until house prices and interest rates start to rise again before making a change.
Alliance & Leicester Mortgage Director Nici Audhlam-Gardiner said: "It is perhaps unsurprising that some homeowners currently on SVR deals are reluctant to commit to a new mortgage but past experience shows that fixed rates tend to increase in price before the base rate, in anticipation of the base rate increasing."
The lender is this week launching a new range of fixed-rate mortgages with interest rates as low as £2.99 per cent.
Yesterday the Bank of England announced it would hold interest rates at 0.5 per cent and that it would inject a further £50 billion into the economy in the form of asset purchases.