Home movers opt for fixed rate mortgages

Category: Mortgages
Date: 7/14/2010

Home movers are increasingly opting for fixed rate mortgages as anticipation grows that interest rates might be about to rise.

Almost three quarters of all mortgage applications in June were for fixed rate mortgages, according to Countrywide, a level not seen since October 2009.

The products of choice amongst borrowers were two year fixed rate mortgage deals, having generated the highest volume of applications in June.

Overall, the estate agency said four in every five mortgage applications made last month were for two and three year fixed rate products.

Fixed rate mortgages also remained the most popular type of remortgage product with more than three quarters of remortgage applications being for fixed rate deals.

"The popularity of two year mortgages over longer-term products indicates that any nervousness over unemployment and government spending cuts is currently a short term concern," said Grenville Turner, Countrywide's group chief executive.

If you're looking for a new two year fixed rate mortgage, the best currently available in the market is from Yorkshire BS. Open to borrowers with a 25% deposit, the rate of 2.89% fixed to 31 July 2012 sees it top our two year fixed rate mortgage best buy chart.

Not far behind is a deal from The Co-operative Bank available at 2.95% to 30 November 2012, also to borrowers with a 25% deposit.

If you're looking to remortgage, Nationwide is currently offering an attractive five year variable rate deal at 3.99%.

Find the best mortgage rate - Compare best selling mortgages