Published: 23/06/2009

Interest rates on fixed rate mortgages have looked very attractive during the last six months with rates of less than 3% available for two year terms and some sub 5% offers to be found in the five year market. However within the last couple of weeks we've noticed that a number of lenders have started to increase the interest rates they are charging on their fixed rate mortgage products.

So far we've seen rates hiked by Nationwide Building Society, Northern Rock, Abbey, Alliance & Leicester, Britannia Building Society and First Direct. The Increases range from 0.2% to 0.8% in some cases, however there are still providers that haven't increased their rates yet, but it's only a matter of time before they follow suit.

So, if you're someone who's not been too sure what to do and have been waiting for rates to hit the very bottom before committing yourself to a new fixed rate, then it may well be time to consider making that move.

By entering your borrowing requirements on the Moneynet mortgage search you will be able to see details of the mortgages that are available that meet your specific criteria. We will show you the interest rate, the lending fee, the total cost and the monthly repayment amount to help you choose the mortgage that ticks all the boxes for you.

If you'd rather speak to a mortgage specialist to discuss the options in more detail, we can offer you this option too, click for details. The other thing you need to be wary of now is that things have changed in the last couple of years. Previously when you took out a mortgage, whether you were borrowing 50% of the value of your home or 90% of the value, you would be charged the same interest rate, but not anymore.

Because house prices have fallen by more than 20% in some areas, the banks are being ultra cautious with their mortgages as they are not sure how much further prices have to fall. The latest findings from the Halifax and the Nationwide house price indices has shown that the price fall has started to slow up, but some experts are saying that there may be a bit further to go as yet.

The difference in the mortgage rate charged, based on the percentage of the value of your home you are looking to borrow (known as Loan to Value or LTV), can vary quite dramatically and have a big impact on the amount you repay each month.

For example, if you wanted a five year fixed rate mortgage from Nationwide, the UKs biggest building society, at 75% loan to value you would be charged 5.94%, but at 85% LTV it jumps by a full one percent to 6.94%.

So whilst rates are starting to move, it's important that you don't panic and rush into changing your mortgage unless you've done your research and you're happy with the rate and fees and any early repayment penalties that may apply.

If you're in the slightest bit unsure, it's best to speak to a professional mortgage expert before signing on that dotted line.