Mortgage Deals Improving!

Northern Rock are chasing the market and are aiming to provide 1 in 10 new mortgages. The only way to do this is to lower rates and this is exactly what they have done.

The result is that they have initiated a mini pricing war. Abbey and Woolwich have responded by lowering rates, so sub 3% trackers are now widely available.

There has also been a move upwards in loan to value banding’s, so the best rates are now available at 75% LTV – an improvement over the 60% that has typically been on offer.

The key question is whether to fix or track. Tracker rates are sub 3%, but how long will they last? A sub 5% fix over 4 years or more will offer excellent value.

So if you cannot afford a mortgage if the rate exceeds 5%, fix now on a longer term fix – Northern Rock have a 4 year fix at 4.89% at 70% LTV. If you can afford it, a tracker will be cheaper now and in the immediate future, but be prepared for far higher costs when rates inevitably increase again.

This entry was posted on Saturday, October 10th, 2009 at 10:04 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.