First-time buyers could be about to wave goodbye to record low rates, according to analysis from Moneyfacts.

The financial information provider warned that, although borrowers have been treated to all-time low mortgage rates recently, the trend is now reversing for those with a small deposit.

In fact, the average two-year fixed rate at 95% loan-to-value (LTV) has increased by 0.10% since April and by a substantial 0.35% since the start of the year – from 3.89% to 4.24%.

Borrowers with 10% upfront have also seen a rise, albeit less significant. Two-year fixed rates up to 90% of the property’s value are now on average 2.77%, compared to 2.72% at the start of the year.

At the same time rates remain at their lowest level for those with large deposits, said moneyfacts.co.uk.
 
Charlotte Nelson, finance expert at the firm, said: “This is disappointing news for first-time buyers who have struggled to gather enough cash to put towards a deposit, only to now find rates are starting to rise.
 
“Borrowers looking for a two-year fixed rate at 95% LTV will find that monthly repayments will be £29.10 more expensive if they take out a mortgage today compared to the start of the year. This rate reversal is not just affecting two-year fixed rates, either, with the average five-year rate at 95% LTV increasing from its lowest ever point of 4.37% in January 2017 to 4.55% in July.
 
“First-time buyers might feel like they can never catch a break, facing large deposits and now rising rates, but it is not all doom and gloom, with more deals on the market at current than at any time since the financial crisis.”