5 year fixed rates falling under 5%.

5 Year fixed rates falling

5 Year fixed rates falling

5 year fixed rates falling as lenders announce new rates this week. Sub 5% rates released

Several high street lenders have released fixed rates below 5% as inflation news filters into cheaper mortgages.

Following on from better than expected inflation figures and The Bank of England having voted to leave the base rate unchanged at 5.25%. We are finally seeing the effects on the mortgage market. Several of the high street’s most popular lenders including NatWest, Halifax and Barclays have released new products this week. Some of these lenders have reduced their rates by over 0.5%.

Fixed rate mortgages are priced in line with the Sonia swap rate and these have decreased recently. This is why 5 year fixed rates are coming down at last.

We now have available 5 year fixed rates from 4.82% and 2 year fixed rates from 5.28%. The rates are dependent on your Loan to Value (LTV) and the better rates are at 75% and below. To work out your LTV divide the amount you need to borrow by the value of your house and multiply by 100.

Are we seeing the first green shoots of a recovery in the housing market?

The combination of 5 year fixed rates falling in the short term and house prices at a more reasonable level should start to unlock a depressed housing market. If you combine lower interest rates with lower house prices then buying a home is certainly at it’s most affordable for a while.

If you have been delaying that move or purchase then it may be worth a call to see how the land lies, you may be surprised.

What effect will this have on my current mortgage when my current deal finishes?

If you are soon to be coming off a fixed deal then there’s no denying that your monthly payments are likely to be higher. On a positive note we hope to see rates relaxing in the coming months so the increase may not be as bad as you were expecting.

If your mortgage product is within six months of ending you can secure another now. We will review your rate at regular intervals over the 6 month period, if a cheaper rate becomes available we will swap you onto the cheaper rate. This means you have locked a rate in now (just in case they rise again) but benefit from any reductions before your old rate expires.

What does this mean for the mortgage market?

This is a big step in the right direction. It doesn’t mean we are going to see things back to normal immediately but we are already seeing major lenders reducing their rates. If inflation continues it’s general downward trend then we should see rates reducing more over the coming weeks and months.

How can we help?

As independent Brokers we have real time access to rates as they change. If you just want a quick conversation about what your mortgage may look like in the future or you’ve been putting off moving then we will be happy to help you make an informed decision.

The first step is a conversation with one of our experts.

If you’d like to learn more about mortgage products and how we can help you, please don’t hesitate to get in touch with our team. We’re here to help you navigate the ever-evolving world of mortgages and guide you toward a brighter, greener home.

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