A 30-year fixed-rate mortgage? What astonishingly bad advice Mr Shapps | Money | guardian.co.uk

A 30-year fixed-rate mortgage? What astonishingly bad advice Mr Shapps | Money | guardian.co.uk

In July 2007, when the property market was still fizzing and the Bank of England base rate was 5.5%, Nationwide launched a 25-year mortgage at 6.39% aimed at first-time buyers. Just a month later Halifax issued a near-identical product.

At the time, Nationwide hailed the deal as offering "long-term stability and flexibility for borrowers who want to protect against fluctuations in interest rates".

The deal was a swift response to a call by then-chancellor Alistair Darling, who said he wanted to make long-term fixed-rates for 20-25 years more affordable for borrowers.

In reality, borrowers who took Darling's advice were crucified. The long-term deal came with a painful get-out clause – if .....