Rates plummet for long-term fixed mortgages
Published ¤ 23/04/2012 15:59:44
The average rate of a five year fixed mortgage has decreased over the past year, from 5.59% to 4.86% today.
Louise Holmes, spokesperson for Moneyfacts.co.uk, commented: "Average rates for five year fixed rate deals have been falling steadily for the past couple of years."
"Fixed rate mortgages offer the reassurance of a set monthly payment and can be beneficial when planning financial budgets, as the repayment amount remains the same over the duration of the term.
"The cost of funding through the swap rate market has also decreased dramatically, causing a knock-on effect of lenders offering low rates on long-term mortgages.
"Interest rates are predicted to stay at the historical low of 0.50% for the foreseeable future. Borrowers would be wise to take advantage of the low mortgage rates, however, as lenders will begin increasing product rates once interest rates rise."
Paul Skinner, managing director of Hampshire based mortgage broker, PKS said "This is one of the best times we have seen for longer-term fixed rates. Last year saw the introduction of the "best of both" tracker to fixed rates, which offered better value than most long term fixed rates, but now the 5 year fixed rates weem to offer better overall value."
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