Swaps started edging downward last week.
– One-year money is down 0.05% at 4.50%
– Two-year money is down 0.05% at 4.42%
– Three-year money is down 0.04% at 4.43%
– Five-year money is down 0.04% at 4.43%
Cheltenham & Gloucester has advised that it is withdrawing its fixed rates on October 3 and that they are likely to be increased. It is also changing its large loans policy. For loans over 1.5m the product fee is likely to be 999, the client will probably have to pay a survey fee and the tracker rate at this level is likely to have penalties.Alliance & Leicester has a new market leading three-year fixed rate at 4.24% with a 395 fee. There is also a good two-year fixed rate for remortgages at 4.38% that comes with a refund of valuation and either 250 cashback or free legals. The fee for this is 495. A&L has reduced its five-year fixed rate to 4.44%. BM Solutions has launched some scorching buy-to-let remortgage deals. The highlight is a two-year tracker at base less 0.01%, which give a pay rate of 4.49% with free legals and a refund of valuation (up to the usual 490). The fee is 1.5% and the reversionary rate is 1.95%. It also has a rate at base plus 0.49% for two years, with the same freebies but with a 1% fee. Both products have penalties of 6% for two years. BM Solutions has also launched a cashback remortgage deal with the same freebies, a pay rate of 1.95% over for the life of the loan, the client gets a 5% cashback, there is a 1.5% fee and penalties of 6% for the first three years. All these deals are available to 85% LTV. The Mortgage Works has followed Mortgage Trust and cut its three-year fixed buy-to-let rate to an incredible 4.55%. It still has a 1.5% fee and the rental calculation is 125% of the pay rate. Let’s face it, if you can’t get it through at that rate, it’s not likely to fit anywhere else. As well as its 4.55% three-year buy-to-let deal, Mortgage Trust also has a two-year fixed at 4.89% available to 85% with a 599 fee. I owe TMW an apology for accusing it of kicking almost every surveyor off its panel meaning it would no longer use good firms like Ashdown Lyons. I got it wrong. It is allowed to instruct all the surveyor firms on its panel but the brokers who can package are restricted to five surveyors. I’m struggling to get my head around this. If it can instruct these firms, why can’t we? Well done to Abbey which has reduced its two-year fixed rate to 4.29%. It is available for loans up to 75% LTV and comes with free valuation and free legal assistance. The booking fee is 499. Sadly, the maximum loan is 500,000. It’s good to see another major lender challenging Halifax. And it’s great to see Peter Charge being promoted to director of sales at The Mortgage Business. He has been one of the unsung heroes of BM Solutions. BM Solutions’ loss is TMB’s gain. I’m sure Charge will bring fresh ideas and enthusiasm as well as a bulging contacts book. Tune in next week for the next episode of HBoS musical chairs. The Derbyshire continues to improve its buy-to-let rates. It has just launched a two-year fixed buy-to-let rate at 4.85%. There is a 1% application fee (95 payable upfront, the remainder can be added to loan). As usual it is available to 80% LTV. Bank of Ireland says it increased its fixed rates to preserve service levels. I like this sort of honesty from lenders and it’s a good idea not to let itself get buried under applications. BoI’s new two-year fixed is 4.49% and three-year fixed is 4.55%. Its two-year fixed remortgage rate is now 4.79% and the three-year fixed remortgage rate is 4.85%. Three-month LIBOR is unchanged at 4.60%. The base rate is 4.50% so the market sees little chance of change in the next three months. Twelve-month LIBOR is down 0.02%at 4.53%indicatingthe City thinks there will not be further decreases in base rate in the next 12 months. Jonathan Cornell is technical director at Hamptons International Mortgages
Hero of the week is Alliance & Leicester for launching a market leading two-year fixed rate product at 4.19% (for loans up to 250,000). For loans between 250,000 and 500,000 the two-year fix is 4.24%.
Cheltenham & Gloucester communicated changes via the usual method i.e. the BDM calling to tell us what he knew. Why can’t this be done by email? The system is like Chinese Whispers. It is villain of the week.