Don't choose the wrong switch-to-fix mortgage
Some of the biggest high-street lenders offer switch-to-fix mortgages that do not let customers switch in to their cheapest new business fixed rates. Instead, they limit customers to their existing customer mortgage rates and they are often considerably more expensive.
The idea of a switch-to-fix mortgage is that customers benefit from the record low base rate trackers currently available and then, if rates start the rise, they can use the option to fix their re-payments. However, an article in The Sunday Times last week highlighted the Yorkshire Building Societies five-year fixed rate as an example where an extra £5,400 could be added to re-payments by taking an existing customer rate.
It is important that borrowers get access to the banks new business rates and that they are not given the option of existing customer rates only.
Northern Rock offers a two-year tracker rate on their 'freedom to fix' range at 2.58% and customers can choose a fixed rate at any time from their remortgage range. This mortgage requires a 30% deposit and the arrangement fee is £995.
June 24, 2011
Get started today
Speak to one of our mortgage experts. Book an appointment to come and see us or request one of our experts to call you.
