Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Strategy. Read the original article for full details.

IMLA Releases Swap Rate Guides to Clarify Fixed-Rate Mortgage Pricing

The Intermediary Mortgage Lenders Association (IMLA) has published a report and a five-minute guide to help mortgage advisers understand swap rates and their impact on fixed-rate mortgage pricing. The new publications are intended to bridge knowledge gaps on how mortgages are priced.

The main report, titled "How Lenders Fund Fixed-Rate Mortgages: Swap Rates Explained," was written by Rob Thomas, principal researcher at IMLA and a former Bank of England economist. This report explains how lenders fund fixed-rate mortgages, the role of deposits and other variable-rate funding sources, and how the swap market enables lenders to offer fixed-rate products. It also details why changes in swap rates can lead to rapid repricing of mortgage products.

A second publication, "Swap Rates Explained: A Five-Minute Read," provides a shorter summary for advisers who need a simple explanation for client conversations. Both publications are available to download free of charge from the IMLA website.

The importance of swap rates was highlighted in early 2026 following the outbreak of conflict involving the US, Israel, and Iran. Between early March and early May, two-year swap rates rose from around 3.6% to more than 4.5%. Over the same period, average two-year fixed mortgage rates increased from 3.97% to 5.14%, representing a rise of more than 1.1 percentage points. Tracker mortgage rates, which follow Bank Rate directly, were unaffected.

These resources may be useful for UK letting agents and inventory clerks seeking to understand the factors influencing fixed-rate mortgage pricing, which can impact landlord and tenant decisions in the property market.