With consumer confidence low due to uncertainty surrounding Brexit, banks are offering substantial discounts on mortgage rates to pull in customers. Indeed, we have seen rates dramatically slashed on residential and BTL products with both 2-year and 5-year fixed rate deals dropping daily. If this trend continues, we could see rates drop below the 1% mark by the turn of the year so is this the perfect time to refinance?
It is easy to understand why consumers are reluctant to purchase new property or refinance existing property in the current climate. Lenders are adapting to this by reducing mortgage rates to entice consumers into purchasing or switching lender. As of writing, we have seen residential 2-year fixed rates as low as 1.05% and experts predict that these could fall below 1% even after Brexit.
Additionally, we have found that three of the biggest lenders in the UK are competing head to head for the lowest residential 5-year fixed rate mortgage deal with the cheapest rate currently sitting at an astonishing 1.44% albeit with a £1,495 arrangement fee.
This extraordinary price war has intensified in recent weeks as lenders struggle to attract business and the customer could be the one to benefit. Currently, the mainstream retail banks can lend so cheaply due to the low Bank of England base rate of 0.75% which was maintained by the Monetary Policy Committee (MPC) back in August of this year.
Despite a perceived slowing down of the market, mortgage approvals are at a 10-year high for the first half of 2019 and the number of first-time buyers is at its highest level since 2007, at 170,000. The best deals in the marketplace are available at 60% LTV but we have seen rates as low as 2.59% for 95% of a home’s value – a record low.
While rates are at their most competitive in quite some time, consumers should be wary about the additional arrangement fees attached to these mortgages and be sure to understand these before finalising the deal and signing on the dotted line. This is where the advice of a broker can prove invaluable as we can source the lowest deal in the marketplace inclusive of fees that best fits your circumstances.
A key advantage of working with us when rates are competitive is that we have access to the whole of the market meaning that we can source the most favourable terms across the entire spectrum of mortgages within the UK space. We can contrast and compare deals quickly and efficiently and we will only ever charge on successful production of a mortgage offer.
Additionally, we offer an ongoing mortgage review service meaning that we will contact you before your mortgage facility is due to expire and prepare a report of the options available to you at the time. This will ensure that you will always be placed on the most beneficial terms available to you. If you would like to discuss an enquiry then feel free to phone us on 0345 873 1234 or email info@specialistmortgages.uk.com