There has been little movement in the cost of residential mortgages over the last three months, according to research by Mortgage Brain. With mortgage costs changing by no more than 1% over the last three months, the cost of a mortgage in the UK remains at a record low.
The lowest rate 90% LTV five-year fixed rate mortgage now costs 5% less than it did this time last year – and the same can be said of 60% LTV two- and three-year fixed rate mortgages, indicating that the mortgage market is stabilising.
“Following the long period of record lows… our short-term analysis can be seen as another sign that we are moving towards a period of cost and rate stability,” explained Mark Lofthouse, CEO of Mortgage Brain.
Low mortgage costs mean buyers can now get mortgages with initial rates as low as 0.98% (from the likes of Yorkshire Building Society), and yet many people are still struggling with repayments.
The Financial Conduct Authority (FCA), has said this week that an investigation needs to be made into the treatment of consumers with interest-only mortgages due to concerns that many of these borrowers are not able to repay them.
“We estimate around 10,000 borrowers each year, between now and 2020 are coming to the end of their interest-only terms,” said Dean Mirfin, technical director at Key Retirement, praising the FCA announcement. “Around 5,000 of those are expected to have no repayment vehicle at all. Many will end up selling their homes to repay their maturing loan,” he explained.
Whether you’re looking to take out a new mortgage or switch lenders to get a better rate, the important thing to remember is to always seek expert advice. Mortgages can be complex, and between low rates and high fees, it can be difficult to know what the best option is.
That’s why we’ve teamed up with London & Country, the UK’s leading free mortgage broker. L&C can give you expert advice on all your mortgage needs, so you can be confident that you’re getting
Last updated: Wednesday, 19 April 2017
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