DEMO — development content for layout testing. Not real editorial reporting.
DEMO content for development and layout testing — not real editorial reporting.
Lenders price mortgages relative to their own cost of funds, which is linked to policy rates and longer-term market rates for fixed-rate loans.
How it works
They add a margin for credit risk, operating costs and the capital they must hold, adjusted for the borrower’s deposit and income.
Mortgage rates reflect lenders’ funding costs, risk assessments and competition — not just the central bank’s rate.
What to watch
Competition among lenders and the mix of fixed and variable products vary widely between countries.
Key concepts
- Mortgages
- Interest rates
