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Borrowers continue to opt for fixed rates

Mortgages Direct, the financial subsidiary of Spicerhaart, has revealed that more borrowers are continuing to opt for fixed rate deals because they arent convinced low level of interest rates will hold.

Research from Mortgages Direct shows 96% of borrowers opt for fixed rate deals of two to five years.

Peter Gladdy, director of Mortgages Direct, says: “With many fixed rate deals being withdrawn from the market and being replaced by higher rate deals, albeit still at competitive rates, borrowers are eager to snap up the remaining affordable deals. Rates for fixed deals have generally increased by 0.2% to 0.3% – however there are still some very competitive offers with five year fixed rate deals under 5% and two year fixed rate deals under 3% still available.

“An increasing number of borrowers are now becoming a lot more cautious and are not prepared to take the chance that the base rate will remain at the current level and are therefore fixing their loans. Choosing a good fixed rate is always a better alternative as borrowers can make substantial savings.”

As well as exercising caution by opting for fixed rate deals borrowers are showing a more responsible attitude to debt with the number of borrowers opting for repayment deals over interest only deals increasing to 71% from 65% last month.


Borrowers opt for fixed rates

Some 86% of mortgage borrowers opted for fixed rates in October as they rushed to beat the progressive withdrawal of the best deals on the market. Almost half of those chose two-year fixed rates, attracted by the low headline interest rates. This compares to 75% of borrowers who took fixed rate mortgages in the first […]

Letter was like complaining about the shape of pyramids

From M R Hird The letter, ‘Paragon must change to become competive again’ (Mortgage Strategy, October 31) was like complaining about the shape of the pyramids. When it comes to standards there are many so, as brokers, we have plenty of choice. But while making that choice I would take into consideration, as it would […]

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IFAs call for innovation in home reversion sector

Independent financial advisers are calling for providers to show more innovation in home reversion schemes, says Bridgewater Equity Release. Peter Couch, managing director of Bridgewater, says advisers must be able to give clients what they need, whether it be as much cash as required, a specific release amount, regular payments over time or the ability […]

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