Posts with tag: fixed-rate mortgage

Co-Op offer UK’s lowest fixed-rate mortgage

Published On: May 5, 2015 at 12:49 pm


Categories: Finance News

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The mortgage battle has moved up a notch with the news that the Co-operative bank has launched the UK’s lowest-ever two year fixed rate.

Offering a fixed-rate of 1.09% over two years, the Co-operative’s deal will be available on all mortgages up to 60% LTV. The deal is open to both new and existing borrowers and will require a fee of £1,499.

Additionally, the bank has announced its lowest-ever 90% fixed-rate. Again being a two-year deal, the rate is fixed is 2.64% and requires a £1,499 fee.[1]

Mortgage battles

A considerable mortgage battle has been rumbling on since last year but seemed to step up gear over recent days, with HSBC and Barclays both launching five-year fixed-rate deals of 1.99%.

Stuart Beattie, head of mortgages at the Co-operative bank, said that, ‘with rates at record lows, it’s a great time for customers to consider taking out a fixed-rate product. We are delighted to offer the UK’s lowest ever two-year fixed rate mortgage, which is ideal for borrowers.’[2]

Co-Op offer UK's lowest fixed-rate mortgage

Co-Op offer UK’s lowest fixed-rate mortgage


However, experts are warning lenders to look closely at all fees involved, particularly those to be charged when the fixed-rate period is concluded.

‘If you think you are going to have to move your mortgage again in two years time, you’ve got to think whether you are going to have to pay another fee,[3]’ said Rachel Springall of Moneyfacts.

Customers are also being warned of the reversion rate at the end of their fixed-term agreement. This is the interest that will be charged at the end of the period, and in the case of the Co-Operative, the reversion rate is a fairly high 4.74%.[1]

Some experts have predicted that mortgage rates could sink even lower and Springall believes that, ‘we’re going to see a few months yet of this price war.’[1]






Pension reforms lead to more BTL mortgages

Published On: April 30, 2015 at 10:37 am


Categories: Landlord News

Tags: ,,

Changes in pension regulations have led to an influx of lower rate buy-to-let mortgages becoming available on the market.

Figures from Moneyfacts, a financial product analyst firm, indicate that investors can now choose from 226 different fixed-rate mortgage deals, as opposed to 162 just six months ago. Additional statistics from the same report show that the average two-year fixed-rate deal has dropped to 3.45% from 3.7% over the same period.

Pension reforms

The new pension regulations, which came into effect on April 6th, saw those over the age of 55 able to access their savings as a taxable, lump sum. Many are using this to subsequently invest in the property market.

As such, lenders are subject to fewer restrictions on their buy-to-let mortgages, with the transaction now being treated as business lending. This is in contrast to residential lending, regulated by the Financial Conduct Authority.

Charlotte Nelson of, believes that buy-to-let mortgages are, ‘experiencing a renaissance, becoming not only more widely available but cheaper too.’ She continued, saying, ‘with more five-year fixed rate deals charging below 5% than ever before, it is little wonder that the newly emancipated pensioners are genuinely considering buy-to-let as a retirement option.’[1]

Pension reforms lead to more BTL mortgages

Pension reforms lead to more BTL mortgages

Seek assistance

Nelson warns however that investors looking at purchasing a property as an alternative to a pension must, ‘seek the guidance of a financial advisor who can access a larger portion of the market.’ She continued by saying, ‘with easy savings to be made,’ with the right advice, people are more likely to be, ‘recouping more in rent, which will allow you to get a bigger return on an investment.’[2]

A word of warning has been issued by HMRC experts, who claim that pension-savers that do not ensure that they have tax-efficient methods of withdrawals could face large bills.