The latest National Mortgage Index released by Mortgage Advice Bureau and Coreco Group has indicated that the bulk of new mortgage applicants are opting for a fixed rate mortgage. Of the total mortgage applications for March 80 per cent were for fixed rate deals, up 1 percent from February.
Borrowers who appear to be making their decision based on the expected interest rate rises and rather than risk the short term gains that a variable or tracker rate mortgage could deliver are happier to opt for the fixed rate deals.
Homeowners also opted for a fixed rate mortgage with 73 per cent of those who remortgaged in March opting to fix their payments. Remortgage applications fell slightly in March, compared to February’s figures but applications were still over 31 per cent higher than in March 2010.
Brian Murphy, Head of Lending at Mortgage Advice Bureau commented:
“March figures are encouraging and continue the positive start to the year with another month on month increase in borrower activity. This reinforces the belief that a more stable market is slowly returning.”
He also said:
"We may well see remortgage transactions dropping off further in April with inflationary pressures easing, making it less likely that we will see a rate rise before the summer."
Are we going to see a rate rise or has the unexpected easing of inflation reduced the pressure on the Bank of England?
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