Fixed-rate mortgages attracted 14 per cent more customers in October than in September, the Council of Mortgage Lenders (CML) has revealed.
Fixed-rate mortgages constituted 59 per cent of loans for house purchase in September but 62 per cent in October – when a total of 124,100 fixed-rate mortgages were taken out.
CML director general Michael Coogan believes the increase in fixed-rate loans showed customers were making "shrewd borrowing decisions", proving they were "well aware that interest rates were expected to go up in November".
The popularity of fixed-rate is a positive sign of longer-term financial thinking, Mr Coogan stressed.
"It is encouraging that many borrowers are planning ahead financially and locking themselves into a period of certainty about their monthly mortgage repayments," he said.
The surge in the popularity of fixed-rate may continue into the new year, with a number of analysts such as Paul Dales at Capital Economics predicting further rate hikes in early 2007.For more information on mortgages, click here.
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