According to recent report some industry officials are encouraging homeowners and new buyers to fix their mortgage interest rates amidst speculation that the base interest rate could rise sharply in the future having been slashed over the past seven months and having falling to its lowest level in the three hundred and fifteen year history of the Bank of England, at 0.5 percent.

With the base rate at an all time low, fixed rate mortgages have also fallen to highly competitive rates, and some industry experts think that homeowners and new property owners should take advantage and bag themselves a low rate fixed rate mortgage before interest rates start to shoot up again, as many have predicted that they will.

Whilst interest rate increases are not expected to come for some months, it is thought that when they do start they will be rapid and steep.

After the May Monetary Policy Committee meeting the Bank of England left the rate unchanged for the second consecutive months, leaving it at 0.5 percent.

One mortgage brokers said that the “decision by the MPC to leave the bank rate unchanged for the second month running is likely to be the precursor for several more months of the same. However, whilst it is difficult to be confident how long bank rate will stay at 0.5%, it is likely than when the MPC starts increasing it it will move up quite quickly, which could be very uncomfortable for anyone still locked into a variable rate mortgage at that time.”

He added: “Borrowers on variable rate mortgages, especially those with any sort of interest-only mortgage, should therefore be very aware of the risk of a rapid rise in their payments at some stage, even though that may not happen this year. Switching to a fixed rate will be the best way for most people to buy protection from rising rates.”

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