Mark Carney, the governor of the Bank of England has stated that interest rates could rise before the end of the year.

So how would this affect savers and borrowers alike?

We know there are more savers than borrowers, so more people are likely to be pleased at the prospect of rising rates, than those who will be adversely affected.

Experts believe that it is unlikely that existing fixed rates will be withdrawn quickly. However, it is unlikely they will now decrease, so individuals on a variable or tracker rate may wish to switch to a fixed rate deal sooner rather than later.

‘If you are on a variable rate, and would struggle to pay your mortgage if rates rose, it is worth locking into a fixed rate,” says Mark Harris, chief executive of broker SPF Private Clients.

“There are some really cheap deals on the market, with two-year fixes starting at 1.05{06aeb1921e0b802d2bd9c766bc98fb11cc6a46c2b0593ed9c88a0e29cf417a34} and five-year fixes from 2.14{06aeb1921e0b802d2bd9c766bc98fb11cc6a46c2b0593ed9c88a0e29cf417a34},” he said.


Source: BBC Business News