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Average two-year fixed-rate mortgage edges close to 6%

The average two-year fixed-rate mortgage on offer is edging closer to 6% as lenders continue to push up their rates.

A typical two-year fixed-rate mortgage on the market now has a rate of 5.97%, across all deposit sizes, financial information website Moneyfacts.co.uk said.

This was a jump from an average of 5.75% on Monday and up from 4.74% on the day of the mini-budget.

The figures were released as lending giant Halifax said it will be updating its rates on Wednesday – reflecting the recent increase in mortgage pricing.

A Halifax spokesperson said: “On October 5, we’ll be updating the rates on our homebuyer mortgage range.

“We continue to have a range of fixed-rate product terms available up to 95% LTV (loan-to-value).

“The new rates reflect the continued increase in mortgage market pricing over recent weeks.”

The new rates from Halifax will include a two-year fixed-rate up to 75% LTV at 5.84% and five-year fix up to 75% LTV at 5.44%.

The average five-year fixed-rate mortgage on the market now has an interest rate of 5.75%, according to Moneyfacts, up from 5.48% on Monday.

This is an increase of one percentage point compared with the day of the mini-budget, when the average five-year fix was 4.75%.

The number of residential products available improved on Tuesday, with 2,358 deals available, up from 2,262 on Monday.

Hundreds of mortgage products vanished from the market last week amid the economic turmoil stemming from the mini-budget, leading to lenders withdrawing deals and pricing them upwards.

Mike Staton, director of Mansfield-based Staton Mortgages said: “The risk of homeowners ending up in negative equity right now is a high one, and it’s an uncertainty that may lenders just won’t be willing to gamble on.”