Fixed-rate mortgages 'may be a good idea'
27th Sep 2011
Property buyers looking at the range of finance options open to them may be a wise to go for a fixed-rate mortgage if they can commit to the term, two experts have claimed.
Speaking on the BBC Money Box programme, Jane King, mortgage advisor from Ash-Ridge Asset Management, said it is fair to say five-year deals have become more competitive in the last few months.
"If you are not planning to move or if you feel that there are going to be significant changes to your circumstances, whereby you'd like to go for five years without worrying, then a fixed rate might be right for you," she noted.
Melanie Bien, director of communications at Private Finance, added that this really depends on whether people are fixing for five years.
She noted that more people are tending to go for fixed-rate mortgages at the moment, because they are worried about interest rates starting to rise in a couple of years' time.
David Hollingworth, mortgage broker from London and Country, agreed that fixed rates are generally tending to be taken up and have been over the last few years, though many lenders have now blocked off their "very, very cheap" low rates.
"So actually with product improvement there is a lot more opportunity to save money by going to either a tracker or to one of these fixed rates to shore up," he added.
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