The recent EU Referendum result has inevitably created uncertainty within the financial markets, but over the last week banks and building societies have begun to take advantage of falling funding costs by ramping up the mortgage war even further.
Short term fixed rates remain at rock bottom, but the attention has now turned to longer-term deals, with major high street lenders launching some of the lowest 10 year fixed rates on record.
Mortgage products that lock borrowers in for that length of time have not always proved popular, but the gap between interest rates for 5 and 10 year deals has reduced significantly. As a result these new longer terms deals are likely to generate a lot of interest. Certainly the prospect of securing a record low rate and protecting mortgage payments against any fluctuations for the next 10 years will be an attractive one for many homeowners.
There are some important points to consider of course, before proceeding. Borrowers need to be aware that the majority of long term deals carry Early Repayment Charges for the length of the fixed period. It is important therefore to think about any changes in circumstances that are likely to occur over the next decade, and whether more flexibility may be required.
Most deals are portable, but there is no guarantee that a borrower will meet the lender’s criteria when they come to move. As a result, being locked into a deal for this length of time will not be suitable for everyone, but for the right borrower it could be a good chance to secure peace of mind for the future at today’s rates.
Record-low long term fixed rates launched