Fixed rates proving popular

Mortgage lenders are set to see a large increase in the number of people seeking long-term fixed-rate mortgages, according to new research.

Abbey has published a study which shows that the number of people who would like to take out a deal where mortgage interest rates are fixed has increased.

The last six months have seen five-year fixed-rate deals double in popularity, with 24 per cent saying that they would prefer this type of mortgage.

"Recent reports about the shrinking mortgage market seem to have had a profound effect on borrowers," said Nici Audhlam-Gardiner from Abbey.

"Not too long ago borrowers felt that shopping around regularly was the way to get the best deal, now homeowners faced with a dwindling number of mortgage deals seem keener then ever to lock themselves into a deal for longer than two years such as a five-year fix," she added.

The base rate of interest currently stands at 5.25 per cent.

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