Following the trend in the market Northern Rock has announced a cut in its fixed rate mortgages, dropping them down to 6.43 percent from 7 percent.
Anyone looking at getting a fixed rate mortgage will appreciate the reduction but should bear in mind there is an arrangement fee on the Northern Rock products of GBP1,495. As stated other mortgage providers have also been reducing their rates so it is sensible to check the new offers available to find the one best suited to specific circumstances.
Potential home buyers still need a big deposit, this situation unlikely to change for some time yet say Northern Rock. The average deposit needed is around 20 percent currently, meaning first time buyers especially are finding it very difficult to get onto the property ladder.
A study carried out by the Lloyds TSB mortgage department has found that the days of the removal man may be numbered as people take a do it themselves approach.
The bank surveyed their mortgage customers and found that over half of them were planning to move into their new home under their own steam, without employing professionals to move their goods. Lloyds TSB also found that the estate agent was being cut out of 10 percent of home sales as vendors sold privately.
A Lloyds TSB mortgage department advisor commenting on the results suggested that the economic climate could be driving these changes. The average cost of employing a professional removal company is over GBP7,000 so being able to save a lot of that makes good sense.
Abbey National is bringing a 10 year fixed rate mortgage to the market this week aimed at bringing peace of mind to buyers concerned about changing interest rates.
Recent studies have shown that longer period fixed rate mortgages are more popular with consumers, the 5 year versus 3 year fixed rate options proving this point very well. The move by Abbey National to bring in a 10 year fixed rate option is hoped to win more buyers over to the idea, especially as the interest rate is just 6.24 percent. There is an initial fee of GBP999 but this still represents excellent value whilst providing the security that homebuyers crave.
This longer period has impressed industry commentators too since it is expected that Abbey National mortgage customers taking out this option will not be left to face dramatically higher interest rates when the term ends, which is what is happening right now as the plethora of 2 year fixed rate mortgages come to an end.
