HomeUncategorizedAverage mortgage rate rises above 6% for two-year fixed deal | Business...

Average mortgage rate rises above 6% for two-year fixed deal | Business News

The Prime Minister has refused to further support mortgage holders even though higher interest rates make payments more expensive.

Via Sarah Taaffe-Maguire, Business Correspondent @taaffem

Tuesday, June 20, 2023 01:32, UK

The average mortgage rate for a two-year fixed deal has risen to 6.01%, according to a financial information firm.

Meanwhile, the average five-year fixed mortgage rate has risen to 5.67%, Moneyfacts said.

The two-year rate rose from 5.98% on Friday, while the five-year rate rose from 5.62%.

The two-year fixed deal is at a high not seen since December 1 – when the market was reeling from the bankrupt Liz Truss government’s small budget.

Prior to that, the rate had not reached the 6% mark since November 2008.

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It comes as the prime minister refuses to give extra support to mortgage holders despite higher interest rates making payments more expensive.

When asked if the government would offer financial assistance for mortgage bills, similar to those introduced to support energy bills, Rishi Sunak said he understands the public’s concerns. them but his priority is to reduce inflation.

Read more:
Mortgage Misery: What Caused the Crisis, Will It Get Worse, and What Can You Do If You’re Struggling?

“I know people will be worried about mortgage rates,” Mr. Sunak said.

“That’s why my top priority at the beginning of the year was to halve inflation because that’s the best and most important way we can reduce costs and interest rates for people.

“We have a clear plan to do that. It’s being worked on. We need to stick to the plan.”

Sir Keir Starmer also ruled out direct mortgage assistance and told Sky’s Kay Burley program that Labor would “help people pay their bills” with an unexpected higher tax rate on oil companies. gas.

Homeowners warned of mortgage pain

Moneyfacts data also shows a decline in the availability of mortgage products.

A total of 4,683 mortgages came to market, down from 4,923 on Friday – but still more than the 3,890 offered before the election. September mini budget of tax cuts unfinished and increased spending.

Advisory Group of the Resolution Organization has said average annual mortgage payments will increase by £2,900 for those who renew next year.

‘Raceful’ when intervening

Former Bank of England deputy governor Sir Charlie Bean has warned against government intervention, saying it would be “risky” for the government to protect mortgage holders from rising interest rates.

Meanwhile, a Treasury source said: “Borrowing money to subsidize mortgages risks fueling further inflation, forcing the Bank of England to respond with even more interest rates. even higher. That would be completely self-defeating.”

The bank is forecast to raise rates again on Thursday.

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Mr. Sunak points out the support available to first-time buyers to help them advance in real estate.

“There’s support for everyone too – we have a mortgage guarantee program for first-time buyers, we have support for a mortgage rate program to help people. That’s it,” he said. That’s why one of my top priorities is to halve inflation.”

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‘Horror show’

However, the government has been encouraged to act.

Liberal Democrat leader Sir Ed Davey said it was time to “step in” and “anything else would be catastrophic for families struggling with anxiety about losing their homes”.

He urged Mr Sunak to “finally listen to those in need and immediately put an end to this show of mortgage horror with a mortgage protection fund”.

Are you having trouble because of rising rates? Sky News is keen to hear from people who are nearing their mortgages, are experiencing a change in interest rates, or are trying to climb the housing ladder. Email us your story at


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