In a move “designed to attract those who are looking for longer term security,” the society is launching two seven-year fixed rate products, including:
- Seven-year fixed at 2.40% to 75% loan to value (LTV), with a £995 fee
- Seven-year fixed at 2.65% to 85% LTV with no fees
“Although bank base rates remain low, uncertainty remains high,” said Kris Brewster, the society’s head of products. “These seven-year fixed rate mortgages are likely to appeal to borrowers who prioritise stability and prefer to have certainty over their mortgage payments for a longer period.”
With this announcement, Skipton will join a small pool of lenders with seven-year mortgages. According to Moneyfacts, the only other lenders offering seven-year fixes are the Coventry Building Society, Post Office Money, and the Bank of Ireland UK.
“With the possibility of future base rate increases, more people may prefer locking themselves into longer fixed-rate deals to insulate themselves from potential interest rate rises,” Brewster added.
Cuts, BTL and new build
Skipton is also reducing rates by up to 0.10% on its residential five-year fixed purchase products at 85% LTV, starting at 2.14% with a £1,995 fee and a fee-free 2.35%.
In addition, the society is launching a range of three-year BTL and new build products.
The new build purchase-only products include:
- Three-year fixed at 2.49% to 90% LTV with £995 fee
- Three-year tracker at 2.35% to 90% with no fees.
The BTL range includes:
- Three-year fixed 2.64% to 70% LTV with $495 fee
- Three-year fixed at 2.92% to 75% LTV with no fees
- Three-year tracker at 2.55% to 75% LTV with no fees
“In the present environment of low interest rates, BTL would seem to be a more attractive proposition for potential landlords,” commented Brewster.
Earlier this November, the Bank of England (BoE) raised the base bank rate by 0.255 to 0.5%. In its statement, the BoE noted: “All members agree that any future increases in Bank Rate would be expected to be at a gradual pace and to a limited extent.” And said that it expected two further rises of 0.25% in the next two years.