Stock market doom and gloom continues. American interest rates look set in stone at all time lows for at least a couple more years.
Our banks are still in turmoil with large pension deficits and short selling the latest problems to surface.
What of Fixed Rate Mortgage Interest.
- The average two year fixed rate mortgage in the UK has fallen to 4.25%
- Five year fixed rate deals are available at below 5%. This is the cheapest rate for almost quarter of a century and longer than most mortgage terms.
- Two or more years of low interest rates, as predicted by the Bank of England, also make standard variable rate deals look attractive. Beware they do not suit everyone, there is still no one size fits all.
- Product fees have yet to be brought under suspicion of miss selling but the day may come. Meanwhile take care with fees and costs if you are thinking of ‘porting’ your mortgage to a fixed rate deal. The total cost is the crucial issue not the percentage rate.
- Felixibility comes at a price and there is an interesting 10 year fixed rate deal from Skipton Building Society at 5.85% with no fee that would suit many who are less concerned about flexibility.
- The size of deposit still attracts a differential interest rate. Yorkshire Building Society charge 4.64% with a 15% deposit but only 3.69% with a 25% and above deposit.
- Housing market issues of price, loan interest and market activity are still controlled and constrained by the financial turmoil at the powerful banking and financial organisations.
- The damaged state of the western world economies is not going to resolve in the short term. When it is bad it is very bad!
- Mortgagees should keep an eye on the best deal for their own situation. If in doubt sit it out.
- Read Is it Time to Fix Your Interest Rate?