Why are super-cheap 10 year mortgages unpopular? Millions missing out on chance to lock into attractive deals
Published: 22:54, 17 November 2015 | Updated: 22:54, 17 November 2015
Millions of homeowners are missing out on the chance to lock into attractive low mortgage deals that last a decade.
While the amount being borrowed for home loans is rising each month, the majority of buyers are ignoring a glut of ten-year fixed deals.
With interest rates widely expected to go up next year, some providers are already pulling their best rates.
Nationwide announced yesterday that the rates on its best ten-year mortgages were going up by 0.1 per cent.
Golden opportunities: While the amount being borrowed for home loans is rising each month, the majority of buyers are ignoring a glut of ten-year fixed deals
Yet those with a 40 per cent deposit could still lock into an interest rate of 3.04 per cent with TSB for a decade if they act now.
Monthly payments on a typical £150,000 25-year mortgage would be £714.44, with the total cost including fees of £995 over the ten-year period being £39,895.
Those with 25 per cent to put down can secure a slightly higher rate of 3.19 per cent with the same £995 fee.
Despite these low interest rates, buyers are sticking to five-year deals in a bid to bring down their monthly repayments.