Fixed rate mortgages fall to lowest level since April 2007

Analysis by moneysupermarket.com shows that mortgage borrowers who are looking for the security of fixed monthly repayments, or are still undecided whether to move off their Standard Variable Rate (SVR) should now consider fixing their mortgage as average fixed rates have fallen across the board to their lowest levels since 2007.

Since April 2008, the average rate for two-year fixed deals has fallen significantly by 3.36 per cent, with rates at a current low of 4.62 per cent. This reduces a fixed repayment on a £150,000 mortgage by £316 to £853. Three and five year fixed deals have also seen their averages reduce steadily since September 2009 after originally rising off the back of the last base rate reduction in March 2009.  The average rate for three year fixed mortgage is now 5.30 per cent, from a July 2009 high of 5.86 per cent. Five year average rates now sit at 5.83 per cent from a high of 6.41 per cent in September 2009.

Hannah - Mercedes Skenfield, mortgages channel manager at moneysupermarket.com, said; "It's promising that fixed rate mortgage rates are moving in the right direction, and we are seeing average rates falling to their lowest level since the height of the credit crisis. With inflation rising, the potential for the Bank of England to increase base rate in the near future increases, so borrowers who are looking to fix their mortgage repayment should consider whether now is the perfect time to switch. However, borrowers need to factor in any fees with the mortgage before they make any decisions as the lowest rate does not always necessarily mean the best value".