New research has revealed that average fixed rates for two, three and five year mortgage deals in Britain are at their lowest since 2012. In addition, the number of ten year fixed deals is beginning to grow.
The investigation by comparison website Money Super Market indicates that home owners looking for the best deal should think about fixing their mortgage now, while providers are slashing rates.
Looking at average fixed term mortgage rates, the research found that many have gone down to their lowest ever levels. This is despite a much-anticipated base rate rise early next year. The average rate for a five-year fixed deal is currently 3.45%, dropping from 4.06% last year.
Short-term mortgage deals follow a similar pattern, with the average three year fixed rate coming in at 3.21%, compared to 4.8% in 2012. The average two year fixed mortgage rate is now 2.9%, when it was 4.48% in 2012.
In addition, the research indicates that those looking to lock-in their mortgage rate for a more substantial amount of time will find that there are many more deals from which to choose. There are currently 41 ten year fixed rate products available, up from 35 just last month.
Dan Plant, consumer expert at MoneySuperMarket, said, ‘mortgage lenders are doing a U-turn, decreasing their rates again after hiking them over the last couple of months.’ He suggests that, ‘even though the Bank of England base rate hasn’t risen yet, it’s a still a case of when rather than if, so any homeowners looking for a cheaper deal should take advantage of the current low rates.’
‘Many lenders allow mortgage holders to reserve rates available now for up to six months for a small fee, so even those who still have some time left on their current deal can benefit. However, you should never rush into decisions to do with mortgages. Before taking out a mortgage, it’s vital to work out the total cost over the term of the deal, taking both rates and fees into account. Expensive fees can wipe out the potential benefit of a lower rate so do the sums first to ensure you really are getting a great deal. The good news is that we’ve seen fees decrease over the last four years, especially for five year fixed deals, meaning it’s a cheap time overall to be looking around,’ Plant added.