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INTEREST rates on two-year fixed mortgage deals have seen their largest monthly rise in eight years.

Data firm Moneyfacts.co.uk say two-year deals hit a historic 2.21 per cent average low in October but have now shot up 0.12 to 2.33 per cent – the biggest monthly increase since August 2009. It’s the same story with five-year fixes, which rose from an average 2.76 in October to 2.88 per cent.

Charlotte Nelson, of Moneyfacts. co.uk, said: “The rise in the average two-year fixed rate has essentially wiped out any rate cuts that have occurred in the last six months.

“Speculation surrounding the base rate rise last week saw SWAP rates (the rate lenders borrow at) rise, with providers having little choice but to factor this into their pricing.”

Since the start of October, 49 per cent of lenders have increased their rates and the recent base rate rise will only add fuel to the fire.

Now could be the time to make your move on to a fixed rate. The best two-year deals are Digital Mortgages from Atom Bank at 1.09 per cent on 40 per cent deposits, 1.12 per cent on 25 per cent deposits and 1.79 per cent on 10 per cent deposits, all with £900 fee. If you want to fix for longer, five-year deals include First Direct’s 1.74 per cent on 40 per cent deposits and 1.89 per cent on 25 per cent deposits, both with £725 fee and Atom Bank’s 2.45 per cent on 10 per cent deposits (£900 fee).