Borrowers refinancing their home loans are finding that mortgage rates are rising faster than the Bank of England's base rate, Bloomberg reports.
Data compiled by Moneyfacts Group Plc shows the average two-year fixed-rate home loan in the UK tops 4% for the first time since February 2013.
Some 3mln homeowners with fixed-rate deals expiring this year or next reportedly stand to be hit.
Zoopla, the property portal, warned earlier this month that home price growth will slow if mortgage rates reach 4%, and values will dip if they rise above that level.
Recent weeks have already seen five-year fixed rates surpass 4%.
"We have seen lenders withdraw parts of, or entire product ranges, with a number citing the pause in lending being due to unprecedented demand," said Eleanor Williams, a spokeswoman for Moneyfacts, reports Bloomberg.
Moneyfacts said the two-year fixed rate has increased 1.75 percentage points since December, compared with a 1.65 percentage point increase by the central bank as it attempts to control inflation.
The data provider said lenders are offering mortgage products for an average of 17 days, a record low, with customers left with fewer options.
Williams noted that providers must manage their service levels after an influx of applications, as borrowers rush to lock in deals before interest rates rise even further.