Fixed, Rate Mortgages UK Home Buyers
Fixed rate mortgages uk from Nationwide available from 1 year to 25 years.
Fixed rates cost hits record low.
The cost of short-term fixed rate mortgages
Fixed rate mortgage costs fell to a record low during June 2010
The cost of short-term fixed rate mortgages fell to a record low during June, figures have shown.
The average rate charged on a two-year fixed rate deal for someone with a 25% deposit dropped to 3.67% during the month, down from 3.78%, the lowest level since records began in 1995, according to the Bank of England.
It was the third consecutive month during which the cost of one of the deals has fallen, with average rates dropping from 4.45% since June 2009, as competition continues to return to the market.
There was also a fall in the cost of five-year fixed rate mortgages, with the rates easing down by 0.03% to 5.35% during June.
The cost of five-year fixed rate mortgages has been falling consistently since November last year, although rates are still up on the recent low of 4.87% in April last year.
It remains to be seen if mortgage rates continue falling during July 2010, after recent figures from financial information group Moneyfacts.co.uk suggested that improvements in the market had stalled since the middle of June.
The number of different mortgage products available fell during the two weeks to the start of July, after steadily increasing since the beginning of the year, while the speed at which mortgage rates are falling also eased, according to the group.
Earlier this month the Bank of England's Credit Conditions Survey also indicated that mortgage availability looked set to worsen during the third quarter of the year.
The figures contained some rare good news for savers, with interest rates increasing across all product types.
The average rate paid on a branch-based instant access account nearly doubled, rising from 0.12% to 0.22% in June, the highest level since December 2008 when the base rate was 2%.
What Are Fixed Rate Mortgages?
they are the most common type of house-buying loan, where the payments and interest rates remain the same, no matter what happens. Interest rates may increase, and other bills may also get bigger, but your payments towards your mortgage are constant. This means that you can settle your budget far in advance, knowing that your mortgage rates will remain fixed. If you have any additional items, such as house insurance, this may go up and down as money rates change, but payments of the fixed term itself does not move.
What Does A Fixed Rate Mortgage Involve?
The fixed rate mortgage will involve a set number of payments over a number of years. There are a few options available, such as a 15 year loan, up to 30 years being the most common. The fewer years involved, the higher the payments made but the less interest that is accumulated. There are also options where you can pay 'biweekly', in which you can pay half the monthly sum every two weeks; this amounts to 13 months' worth of payments, thereby shortening the life of the mortgage.
Reason for Why Pick A Fixed Rate Mortgage
Many people feel more comfortable with a fixed rate mortgage, as it is a fairly stable monthly payment, and this makes budgeting for the amount easier to do. There is also comfort in the knowledge that there won't be any surprises when the bill arrives, and neither will you be hit with any extra sums at the end of the year. Fixed rate mortgages also allow you to 'overpay', or clear off more of your loan sooner, to a certain percentage each year, and do not charge. This can make the customer feel more in control of his money.
Where Can Fixed Rate Mortgages Be Found?
Most banks and building societies will have one, if not several, fixed rate mortgages available. They will have a number of different versions of this mortgage because there are made 'additions', options and services that can be put into the mortgage to make it more suitable to the client. As well as all these options, the booming mortgage industry now means that there are independent advisors, private mortgage brokers, and independent loan services who will all be happy to provide you with their selection of fixed rate options. There are now plenty of Internet sites where advisors, brokers and even the mortgages themselves can be found.
The Risks of Fixed Mortgages
Just like any other kind of loan, the fixed rate mortgage has some problems. Firstly, it is not available to high-risk clients, and anyone who cannot provide proof of earnings will be unwelcome; however, there are other options for them. The other risk is the amount of time it will take to clear the mortgage. A 30 year mortgage will probably cover the whole of the client's working life, a constant monthly payment that can only be paid off early by accepting a heavy 'charge' for breaking the contract. However, if you are looking for a stable mortgage in a world of unstable mortgage rates, then a fixed-rate mortgage is worth looking in to.
Fixed rate mortgages have their interest rates set
for a certain period of time, which can be from one to ten years, after which time the
rate will revert to the variable rate.
Generally speaking, the shorter the term of the
fixed rate mortgage, the lower the interest rate and vice versa.
fixed mortgages have become very popular over
the years due mainly to the vast changes in interest rates we have seen.
A fixed rate mortgage can give peace of mind because
the borrower knows exactly what their repayments will be over a period of time.
One disadvantage is that, should you decide to move
your mortgage or re-mortgage during or shortly after the
fixed rate period, you will normally be subject to early
redemption penalties which can be equal or more than the
benefit you have received.
Looking for a fixed Mortgages 2 - 25 years!
With fixed mortgages this means you know where you stand with your monthly repayments during the fixed rate period, whatever happens to interest rates in general. This enables you to budget with confidence. Nationwide can offer a range of fixes ranging from
2 year to 25 years.
Need help finding best fixed mortgage? Let our financial team find the best fixed rate mortgage deals for you from our panel of lenders
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