The cost of getting fixed-rate mortgages has been on a steady decline for a while. This suggests that as a home owner, there is a definite possibility of you getting a better deal if you put your remortgage plans on hold.
Figures show that the rates for two-year fixes are at some of their lowest ever for prime borrowers, and 10% deposit mortgages are again available.
Thanks to the record low rates, the cost of getting the typical mortgage is still very close to the long-term average as a percentage of take-home pay, even though house prices are at an all-time high.
The fall in rates is because of the reduction in cost of funding for lenders over the past few months. This reduction has given them access to cheap money that can be passed on as loans.
This has led to the price war which is now playing out as lenders continue to scramble to attract customers to meet their end-of-year lending targets, and also build up a strong pipeline of mortgage business for 2015, which is, of course, now just a few months away.
For buyers looking to fix, there isn’t much flexibility around but for borrowers looking for remortgages, it may be a very good idea to wait.
For lenders, the cost of funding is mainly down to expectations of interest rates in the future. A rise in interest rates is out of the question until deep into 2015 with inflation remaining low and wage growth at current levels. Some experts feel that a rise in interest rates will only be seen in 2016 and this means the possibility of remortgage rates coming down further over the coming months.
Cbonline.co.uk, experts in the mortgage market, do 2 year fixed rate mortgages at 2.6% which even with the £999 arrangement fee represents a great rate for your home buy.
To do the right thing for your situation, however, you need to talk to a financial adviser. You should be able to get information on whether you can afford to hold off on your fixed rate mortgages or not. The adviser will also tell you the best option for you out of the plethora of options in the market today.