Homeowners brace for 'big mortgage reset' after average rates rise again

Average mortgage rates have increased again as homeowners prepare for a "big reset" within nine months.Around 2.6 million Brits are expected to have to pay thousands more back each year as interest rates continue to rise and the cost of living crisis takes its toll.

The rate on a new two-year fixed deal reached 5.86 per cent on Monday - up from 5.72 per cent a week ago and 5.33 per cent a month ago. Meanwhile, five-year fixed deals leapt from 5.03 per cent a month ago to 5.51 per cent on Monday, according to financial experts at Moneyfacts. It comes amid warnings that a "big reset of mortgages" is on the way as only a third of borrowers who are on cheap fixed-term deals have so far come off them.A third of such households - around 3.2 million - are paying interest rates of 3 per cent or more, analysis by Capital Economics found."There's going to be a big reset of mortgages for the next nine months. Only a third has come through so far, two thirds is to come," a source told The Times.

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