Market research has shown that mortgages are now the cheapest on record. One of the main causes for this drop in rates is the impact of the tough new lending rules brought into force by the Mortgage Market Review or MMR, which make it harder for some borrowers to obtain a mortgage. As a result of this, mortgages lenders are now trying desperately to attract new borrowers, and are competing for market share. The rental market is also experiencing a new boom. Mortgage rates began to edge up last year, but as prospects of a Base Rate hike fade until at least the end of this year, home loan rates are falling again. Mortgage rates are at a record low, and homeowners can fix for two years at rates just over 1 per cent, and for up to ten years at less than 3 per cent, with HSBC announcing their new two-year fixed rate mortgage at 1.19%. This offer is reserved for those with a 40% deposit or equity. The deal comes with an arrangement fee of £1,499. However, it’s always good to look beyond the headline rate, and at the total cost of a loan. For example, if the arrangement fee was added to the loan upon completion, it would make repayments more than the rival two-year fixed deal from the ¬Yorkshire Building Society at 1.29%, which has a lower £975 arrangement fee. There is a price war between lenders, and today’s low rates may stick around, they may even inch a little lower, but they may also be swiftly axed. To find what could be the best solution for you, please call us for a free consultation on 020 7519 4900. Your home or property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it
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