Borrowers should prepare for a raft of sharp increases to the cost of fixed-rate mortgages as early as next week as lenders are expected to pass on higher borrowing costs.

Recent cuts in mortgage rates have come abruptly to a halt as the banking crisis has brought renewed fear to the financial markets. Yorkshire Building Society plans to increase fixed mortgage rates from Monday. Mortgage brokers said they were now processing new applications as quickly as possible in the expectation that more rates would rise.