The US sub-prime loan crisis may push up mortgage rates in the UK, a former Bank of England adviser has warned. The banks were in a state of “fear and loathing” that could increase standard mortgage rates as well, he added. The current liquidity problems in the banking system have driven up interbank lending rates sharply in the past few weeks. Evidence that these higher interbank rates are now starting to affect financial deals offered to the public has come from several lenders. This week, five lenders - the Anglo Irish bank, Northern Rock, Heritable bank and the Derbyshire and West Bromwich building societies - have each offered new fixed-rate savings deals, but at rates up to 0. TOOLS & GUIDES Mortgage worries? read more