Yorkshire cuts its fixed rate mortgages

Yorkshire is cutting 0.3% off the rate of its two and five year fixed rate mortgages, with effect from Friday, August 4.

The new mortgage rates will now be fixed at 4.79% for two years or 5.14% for five years.

In addition to the headline grabbing rates these products, like all Yorkshire, charge interest on a daily basis ensuring borrowers get immediate benefit for all payments.

They also offer the flexibility to overpay, underpay and take payment holidays within agreed levels.

A 595 fee is applicable to each mortgage.

Dependent on customers circumstances, on the five year fixed rate mortgage Yorkshire may increase the income multiples up to five times salary.

This flexibility should help individuals trying to buy a property in an area where house prices have spiralled.

Due to the variation in fees, it is difficult to compare these new products with competitors, however the cheapest two-year fixed rate mortgage with a similar fee to the Yorkshire is available at 4.69%.

Whilst on the face of it this competitor deal looks cheaper, as the lender still charges interest on an annual basis it costs the customer over 64 a year more.

It is therefore important that best buy tables, media commentators and mortgage brokers make clear the true cost of a mortgage rather than selecting one just based on headline rate.

David Heshon, Yorkshires product development manager, says: A number of borrowers are becoming increasingly worried about the cost of homeownership as interest rates are expected to rise and most utility bills have seen a large price hike this year.

We are therefore finding more people wanting the payment security of a fixed rate mortgage.

We are delighted that these mortgage rate cuts are happening at the same time as a review of our savings accounts has seen a number of savers benefiting from higher rates.