Its two-year fix is pegged at just 0.95%, with a £1,499 arrangement fee. It is available to buyers and those remortgaging, although you will need at least 40% equity in your home or the equivalent deposit.
Those borrowers looking to fix for longer may want to consider a five-year fix launched by NatWest at just 1.17%. This is only available to those remortgaging, with at least 40% equity. There is a £1,495 fee.
The advantage of opting for a fixed-rate mortgage is that it gives you certainty for a set period of time, which is useful for budgeting or simply for peace of mind in case you are worried about interest rates rising. Many borrowers are opting for longer fixes of five years to get a little more security for not very much extra cost but make sure you don’t fix for longer than you are sure about. Otherwise, you may face hefty early repayment charges to get out of the mortgage during the fixed period if your circumstances change.
Borrowers who are on their lender’s standard variable rate are likely to be paying much more for their mortgage than they need to. It is worth seeking advice from a whole-of-market broker, such as AWS Private Finance, to find out whether a cheaper deal is available to you. We can also handle your mortgage application from start to finish and specialise in advising high-net-worth borrowers with complex income arrangements, the self-employed and day-rate contractors.
While the headline rate is important, it is also vital that you work out the total cost of a mortgage – rate plus fees – when comparing deals to ensure you get the right one for your circumstances. Otherwise you could end up spending more than you need to over the fixed period and even beyond.