Mortgage rates tumble, but watch out for the fees warns Uswitch.com
Commenting on recent mortgage rate moves, Michael Ossei, personal finance expert at Uswitch.com, says: “Fixed rate mortgage rates have continued to slide this week, with rewards available for both existing homeowners and first time buyers.
“While falling rates are likely to be greeted with sighs of relief by thousands of borrowers, they don’t come without a sting in the tail. Some of the most competitive deals launched this week by Chelsea Building Society and First Direct come with hefty fees. While Chelsea’s three year fixed rate mortgage offers one of the lowest rates on the market at 1.99%, borrowers will need to have a 40% deposit or equity and stump up an arrangement fee amounting to an eye-watering £1,545.
“While rates have fallen, fees have increased, to the point where they’ve now hit a 25-year high. But to get the best fixed rates consumers have no choice but to pay these high fees, and lenders know it. While interest rates look unlikely to rise anytime soon, consumers remain wary about the future and many will feel they have no option but to pay a hefty fee so they can enjoy future peace of mind.
“Looking ahead we expect to see lenders continue to launch more competitive long-term fixed rate deals with higher LTVs. However, there will also be more encouragement for first time buyers as we expect to see an increase in the number of competitive 90% LTV deals too.”
FOR MORE INFORMATION
Charlotte Nunes
Phone: 020 7148 4664
Email: charlotte.nunes@uswitch.com
Twitter: @uswitchPR
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