Mortgage price war and all-time low interest rates

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13 Jul 2016

The mortgage price war continues with all-time low interest rates

Author: Greg May

Many lenders are introducing new mortgage products with all-time low interest rates as the mortgage price war continues.

Mortgage price war

Why are interest rates being cut?

Banks and building societies often cut their interest rates to attract more people to the housing market, which can then lead to other lenders reducing their interest rates. This explains why we have a mortgage price war on our hands.

Competitively low interest rates could make buying property more attractive, which could see the property market pick up. The buy-to-let market is particularly attractive to investors as they won’t get much return for their money by putting it into a savings account, whereas property could be a rewarding long-term option.

Recently, mortgage lenders have started to decrease ten year fixed rate mortgages which has sparked some discussion around longer-term mortgages and what advantages these could have for you.

Why opt for a ten year mortgage?

Ten year mortgages quoteFollowing the release of these new mortgage deals, a report was published by HSBC suggesting more than seven in ten buyers would consider fixing their mortgage for ten years in order to give them more stability and certainty. This confirms that many households are seeking out long-term stability and financial security.

Just be aware that these types of long term mortgage rate deals tend to come with higher deposits and larger product fees, unless you pay a slightly higher interest rate that comes with a lower deposit and lower fee.

Take advantage of the competitive interest rates

If you’re looking to settle down and aren’t interested in moving on again anytime soon, you could take advantage of these longer-term deals, as coming out of them early does often come with a rather hefty early repayment charge, so you’d probably want to try and avoid that.

If you’re reading this and don’t feel that long term deals are for you, there are many other options so it’s worth speaking to a mortgage adviser. Romans Mortgage Services has access to over 11,000 mortgage products from 90+ lenders, so if you are looking to get on the property ladder, invest in a property, move house or remortgage, our advisers are on hand to offer our expert advice, whether it’s face-to-face or over the phone. Get in touch with us today to book an appointment.

For further information please contact Romans Mortgage Services on 0118 3219 536, or visit: romans.co.uk/mortgages.

Your home may be repossessed if you do not keep up repayments on your mortgage.

There will be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1%, but a typical fee is 0.3% of the amount borrowed.  

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