Money Insider: Fixed rates hold growing appeal for homeowners - Mortgages, Money - The Independent

Money Insider: Fixed rates hold growing appeal for homeowners - Mortgages, Money - The Independent

The volume of fixed rate mortgage searches on Moneynet climbed 22 per cent in July compared with the previous month. It seems consumers are again starting to favour the comfort of longer-term security over a lower cost variable rate.


This change of heart has undoubtedly been triggered by some of the ultra low rates we're now seeing. Some of these fixed deals have now reached a level that makes them a serious alternative to standard variable rate and discounted variable rate deals.

To give you a flavour of some of the keenest fixed rates available, Chelsea Building Society has a two-year fix at 2.69 per cent with £195 fee (maximum 70 per cent LTV), Yorkshire Building Society a three-year deal at 3.14 per cent with £95 fee (maximum 75 per cent LTV) and, if you're looking longer term, you can get 3.69 per cent fixed for five years from Yorkshire with a fee of £95 (maximum 75 per cent LTV). I don't see fixed rates falling much further but some banks have yet to respond to recent falls in swap rates, so there are likely to be other lenders launching rates coming close to those mentioned. It's still not an easy call for mortgage borrowers, as there are pros and cons for both variable and fixed rate products, but as always it's important that consumers seek guidance based on their own financial situation.