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Mortgage Best Buys – December 2019

The Bank of England (BOE) Monetary Policy committee voted to retain the BOE Base Rate at the present level of 0.75%pa.

The mortgage market remains competitive; in the past weeks some lenders have reduced their interest rates even further and arrangement fees, especially in the buy-to-let market.

A few schemes which remain and are worth noting:

  • 2 year fixed at 60% LTV – 1.19% pa, with a lender’s arrangement fee of £995.
  • 5 year fixed offset at 60% LTV – 1.54% pa, with a lender’s arrangement fee of £999
  • 5 year Fixed at 60% LTV – 1.44%pa with a lender’s arrangement fee of £999
  • Buy-to-let 2 year fixed rate at 60% LTV 1.35% with a lender’s arrangement fee of £1,795

*LTV = loan to value

The latest research from Moneyfacts shows that consumers can not only get a better fixed mortgage rate today compared to a year ago, but the number of products charging a fee has also fallen. Those clients who are still paying a standard variable rate on their mortgages could benefit greatly from reviewing their mortgage deals.

The latest Nationwide House Price Index data shows that in November whilst house prices have continued to grow, the growth remains slow. While house prices growth has remained slow, mortgage rate competition has continued to intensify.

Moneyfacts described first time buyers as the “lifeblood of the mortgage market”. A mortgage price war to attract first time buyers with deposits as low as 5% is intensifying, with providers slashing their rates. The rate gap between the average two-year fixed rate mortgage on the market for borrowers with a 5% deposit, and the typical two-year fix for those with 10% deposit is now at it’s smallest in six years. This is despite borrowers with the smallest deposits often being seen as more ‘risky’ and recent reports suggesting uncertainties relating to the economy and Brexit are having an impact on the housing market.

Data collected by Key Partnership shows that the number of equity release products has increased by a staggering 95% in the year to October 2019. While lending in 2019 has been subdued, product innovation has not and advisers now have almost double the number of products to choose from and the widest range of features ever seen in the market. Guided by their advisers, consumers can now choose the product which ideally fits their circumstances, choosing to repay interest, make one off capital payments or protect their family’s inheritance as they see fit.

 

The above content does not represent a personal recommendation. If you have any questions on the buy to let sector reforms, rates or the mortgage market in general, our mortgage team is here to help. Please contact the team on 020 7444 4030 or by email.

Your home is at risk of repossession if you do not maintain mortgage payments.

Residential Repayment – although a number of these deals can be done on an Interest Only basis up to 50%
LTVs Rate Arrangement Fee ERC
60% 2 year Fixed – 1.19% to 31/03/2022 £995 YES
3 year Fixed – 1.39% to 31/03/2023 £999 YES
5 year Fixed – 1.44% to 28/02/2025 £1,495 YES
Offset 2 year Tracker – 1.47% (BOE + 0.72%) £999 YES
2 year Tracker – 1.19% (BOE + 0.44%) £995 NONE
2 year Offset Fixed – 1.25% to 28/02/2022 £999 YES
5 year Offset Fixed – 1.54% to 28/02/2022 £999 YES
65% 2 year Tracker – 1.39% (BOE + 0.64%) £999 YES
Lifetime Tracker/Variable – 2.49% £1,999 NONE
75% 2 year Fixed – 1.26% to 31/03/2022 £995 YES
3 year Fixed – 1.58% to 31/01/2023 £999 YES
5 year Fixed – 1.54% to 01/03/2025 £995 YES

 

Residential – Interest Only – sale of property as a repayment vehicle
LTVs Rate Arrangement Fee ERC
75% all interest only 2 year Fixed – 1.26% to 31/03/2022 £995 YES
5 year Fixed – 1.54% 31/03/2025 £999 YES
Offset 2 year Tracker – 1.63% (BOE + 0.88%) £999 YES

 

High LTV 1st Time Buyers – Repayment
LTVs Rate Arrangement Fee ERC
85% 2 year Tracker – 1.40% (Base + 0.65%) £999 YES
2 year Fixed – 1.55% 31/01/2022 £999 YES
5 year Fixed – 1.79% to 28/02/2025 £1,495 YES
95% 3 year Fixed – 1.39% to 31/03/2023 £999 YES

 

Buy to Let Rates *Average rental cover 145% at 5.5%.
LTVs Rate Arrangement Fee ERC
60% 2 year Fixed – 1.35% to 31/01/2022 £1,795 YES
3 year Fixed – 1.74% to 01/03/2023 £1,995 YES
5 year Fixed – 1.89% to 31/01/2025 £1,795 YES
2 year Tracker – 1.69% (BOE + 0.60%) £1,499 YES
75% 2 year Fixed – 1.56% to 01/03/2022 £1,995 YES
3 year Fixed – 1.65% to 31/03/2023 £1,995 YES
5 year Fixed – 1.99% to 31/03/2025 £1,995 YES
2 year Tracker – 1.69% (Base + 0.94%) £1,499 YES

 

Second Charge, Bridging Finance, Equity Release Loans available – rates upon request
* Some lenders are still prepared to take a more flexible view, with a lower rental cover and stress rate. However, the rates may increase commensurately.
ERC – Early Repayment Charges – if it applies, this is based on individual lenders criteria.