Money Insider: Move fast for the best deals on new fixed-rate mortgages

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The Independent Online

i mentioned last week that there were early signs fixed-rate mortgage pricing was starting to rise on the back of more expensive swap rates.

It seems the market has definitely started to turn. This week there have been more high-profile examples which all but confirm my thoughts that fixed rates have reached their low point and are on the way back up.

Further fixed-rate increases in the past few days came courtesy of Woolwich from Barclays (increases of up to 0.41 per cent); HSBC two and three-year products up by up to 0.50 per cent; First Direct home loans by up to 0.40 per cent; and Norwich and Peterborough Building Society by 0.20 per cent.

To put these increases into context, for someone with a £150,000 mortgage with 20 years to run, an extra 0.5 per cent on the rate translates to £39 more per month on their mortgage payment – an extra £468 per year.

If you are mulling over whether to switch to a new fixed-rate mortgage deal then I would recommend you make an appointment with your mortgage advisor pretty quickly to discuss your options before all the best low-rate deals disappear.

Use new technology to help avoid bank charges

Anyone who has accidentally slipped into the red on their current account or exceeded their agreed overdraft limit will have had to cough up £20, £30 or even more to their bank for their financial indiscretion.

Many people lead increasingly busy lives. They hardly have time to draw breath, let alone make sure their bank account is in order.

While there have been endless arguments about whether the level of unauthorised bank charges is justifiable, to be fair, the banks are using new technology to give customers a better chance of avoiding these fees.

Some banks offer a text alert service, where you get a message sent to your phone when you are nearing your limit. Barclays charges £2 per month for this service (free for student customers), perhaps a small price to pay if you are constantly on the move and do not have the chance to check your account as often as you would like.

Lloyds TSB offers a similar service, but free, as part of its mobile banking application. You can set up free text alerts for high balances, low balances and also when you are nearing your limit.

Last week, First Direct launched a transactional banking application for the iPhone and iPod touch. While NatWest and RBS already have their own iPod apps, these only allow simple balance and statement viewing whereas the new First Direct App allows you to make payments, transfer money between accounts and view your last 20 transactions.

Lloyds TSB has just announced details of its new online service Money Manager, which is aimed at helping online customers take better control of their money. It provides a deep level of detail on where their money goes each month by categorising their spending into groups.

There is also an online calendar option so you can see at a glance what payments are due to be made in the coming days/weeks – something which should help those who struggle to keep on top of their finances. This new functionality is expected to be rolled out in the next few weeks.

So you can see extra help is there if you want it, so why not make the most of the latest banking technology and prevent yourself being hit in the pocket with unwanted bank charges.

Sainsbury's hits savings best buys

While fixed-mortgage rates may be on the up, we are also seeing a positive knock-on in some areas of the savings market with a few better rates for shorter-term fixed- rate bond deals.

This week Sainsbury's finance launched a new Fixed Rate Saver account available for one, two or three years. The pick of the bunch is the one-year option, paying a very competitive 3.20 per cent AER.

The minimum account balance is £5,000 and the maximum £50,000 on this bond, which can be opened and operated online or by telephone. There are no withdrawals or additional deposits allowed once the account is opened but to give you an idea of the returns available, a £50,000 balance would give you interest of £1,280 after 12 months (allowing for deduction of 20 per cent tax).

Andrew Hagger is an analyst at

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