Could 2011 be the year of the fixed remortgage?

Ongoing economic turbulence in 2010 has left the debate over whether to take out a fixed-rate mortgage or a tracker mortgage very one sided.

With interest rates showing no signs of increasing, many homeowners have sat tight on standard rates or opted for trackers to secure the best mortgage rates.

However, as the end of the year approaches, research from first direct has shown that homeowners are beginning to return to the fixed-rate market.

The data from first direct shows that so far in 2010 just one in four mortgages have been fixed-rate products but in the last month fixed-rate mortgage sales have increased to 33 per cent.

Richard Tolchard, senior mortgage product manager at first direct, said: "The canny homeowner has realised that Britain has been at the bottom of the interest rate cycle for a while and 2011 will be the year when fixed mortgage rates start to move up."

He advised borrowers keen to stay on a tracker loan that they need a low flexible mortgage which allows them to switch when they wish without penalty.

Barclays recently launched a switch and fix option for borrowers looking to fix their rates to get the best mortgage rates.
 

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2010-11-24 12:06:30 © Moneyextra.com