Mortgage lenders slash fixed rate offers

Market becoming more competitive, especially for those with a large deposit

October 16, 2012

Several lenders are cutting their fixed rate mortgages for new customers as buyers with big deposits are rewarded with cheap loans. Accord Mortgages, part of Yorkshire Building Society, has launched a ten day sale which includes a five-year fix at 3.29 per cent at 70 per cent loan-to-value and a five-year offset fixed mortgage at 3.49 per cent. Chelsea Building Society is now offering a five year fixed rate at 2.99 per cent for borrowers with a 30 per cent deposit or equity stake. These offers do come with a catch. Both the deals with Accord require a £995 application fee, and Chelsea Building Society are charging a whopping £1,495.

Nationwide has cut its four year fixed rate mortgage to 2.99 per cent for those wanting a loan to value ratio of 70 per cent. Retail giant Tesco’s added mortgages to its banking arm in August and is now offering a five-year fix at 3.19 per cent for those borrowing 60 per cent of their property’s value, although you will have to cough up a £1,295 fee.

Nigel Bedford of mortgage broker Largemortgageloans.com said: “These five-year fixes are fantastic for those looking for medium term security and don’t mind being locked in for that period, and if they can meet the lenders’ criteria.”