Legislation being shaped by the European Union could make it too expensive for building societies and small banks to offer fixed rate mortgages.
If they stopped making these kinds of loans it would vastly reduce the number of fixed-rate mortgages available, according to a report in The Times. Nevertheless bigger banks will still be able to make them available to
It comes as the Bank of England appears to be edging closer towards its first rate rise in more than six years. At the same time, this has prompted a wave of savvy homebuyers to chase longer fixed rate mortgages
When interest rates rise, banks who have lent fixed rate mortgages, see their incomes fall. But they offset this by taking out financial contracts with a counterparty, usually a bank, to reduce their exposure. However new rules being shaped by the European Union could dramatically drive up the cost of these.