Peer-to-peer property lender SoMo has vowed to keep its rates low over the next quarter despite the rising cost of borrowing.
The Bank of England increased the base rate to 1.25 per cent in June, the fifth consecutive monthly rise.
SoMo warned that at least 10 high street mortgage lenders have raised their rates since then but has now told brokers that it will guarantee its own existing low rates for all new business over the next quarter.
The platform said it would hold and honour all rates on bridging loans locked in from July to September.
Read more: SoMo sees 25pc rise in second charge lending
“Interest rates are going up, the Bank of England has also raised its forecast for peak of inflation this year to slightly above 11 per cent, with the FTSE 100 continuing to fluctuate and the war in Ukraine impacting global supply chains and energy costs,” Jade Keval, sales director at SoMo, said.
“We’re in the middle of a cost of living crisis and many commentators are predicting the UK will move into a recession.
“It’s a worrying time with much uncertainty, but what we do know is that brokers should expect most lenders to become risk averse over the coming months, meaning rate hikes and lower rates of underwriting.
“SoMo understands that at such uncertain times, people appreciate guarantees. We therefore want to brokers to know that we intend to hold firm with our existing low rates for all new business over the next quarter, so they can move forward with confidence.
“As a solutions-based lender we want to reassure our broker community we’re committed to finding ways to secure their deals.
“Unlike many other lenders we’ll offer a second charge loan for any business purpose, meaning we’re here to help businesses in need during these tough times.”