Borrowers should be wary of low-rate deals

clock

Borrowers hoping to take advantage of sub-5% mortgage rates may be hit by high fee costs, according to mform.co.uk.

Lower swap rates, the rates at which lenders borrow to fund their fixed rate deals, have allowed many mortgage providers to provide cheap fixed-rate deals, with 24 of the 200 best deals now priced at 5.75% or lower and some going as low as 4.99%. However, mform.co.uk says the high fees that low-rate deals carry can often make high-rate deals more cost effective over a two-year period. Francis Ghiloni, marketing and business development director at mform.co.uk, comments: “Lower headline rates do not necessarily mean lower costs for borrowers. Some of the low initial APRs are only made poss...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Mortgages

Client conundrum: Mortgage overpayments versus investments

Client conundrum: Mortgage overpayments versus investments

1.4 million people will see mortgage deals end this year

Laura Suter
clock 22 February 2023 • 3 min read

Summer economic update: Sunak confirms stamp duty holiday in 'mini-Budget'

Mini Budget

Hannah Godfrey
clock 08 July 2020 • 2 min read

FCA sounds alarm on equity release advice

'Tick-box exercise'

Hannah Godfrey
clock 17 June 2020 • 1 min read