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Consumers prefer long-term fixes for first time: Paragon


Five-year residential mortgages are more popular than two-year deals for the first time, according to Paragon research.

The lender says 48 per cent of applications were for loans of five years or longer in Q4 2017.

That represents an increase of 7 per cent on Q3 2017 and 15 per cent on the same period 12 months earlier.

Two-year deals made up 40 per cent of fixed and tracker cases in Q4 2017, down 7 per cent on the previous quarter.

The figure is also down 14 per cent on the peak periods of two-year fixed rate popularity in Q3 2013 and Q3 2014.

Paragon says the overall popularity of fixed rate mortgages hit another all-time high in Q4 2017, up 2 per cent to 91 per cent of all cases.

Paragon managing director of mortgages John Heron says: “The results of our latest intermediary research highlight the overwhelming preference that the market has for fixed rate products and increasingly for longer term fixed rate products.

“Much of this is driven by the understandable requirement that landlords have for payment stability into the future against an uncertain economic backdrop.”

The findings come in Paragon’s latest Financial Adviser Confidence Tracking Index, based on interviews with 198 mortgage brokers.



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