Mortgage News
Lenders targeting short-term deals: Moneyfacts
Lenders have become more willing to lend in the last few months and are offering short-term deals, according to the latest research from Moneyfacts.
In the last eight months, while Bank base rate has been kept on hold, the number of residential mortgages available has increased from 1,209 to 1,624.
The majority of mortgages were two year fixed-rate deals. Average rates on these two-year fixed deals continue to see significant falls and stand at 4.93% today. Rates remain less favourable on longer term deals, where the average five year fixed stands at 6.15%. The average three-year rate continues to increase, standing today at 5.60%.
Michelle Slade, spokesperson for Moneyfacts, said that borrowers and lenders seem to prefer shorter term deals, where changes can be made relatively quickly if market conditions change dramatically.
She added: “Increased competition in the two-year market has increased the competitiveness of the deals available, but at £928, the average arrangement fee remains more than £100 higher than on longer deals. Borrowers’ love affair with shorter term deals means lenders benefit from the increased frequency with which arrangement fees become payable.”
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