Mortgage News

Kensington launched a range of 40 year term fixed rate mortgages this week, with some deals available to those with deposits of just 5%. Borrowers considering a fixed mortgage of 10 years or more should carefully weigh up the pros and cons of locking into a deal for so long and may want to consider speaking to a mortgage broker for advice.

Money unlocked from property via equity release is set to break the £4 billion this year, with homeowners taking out £2.989 billion via equity release in the first nine months of 2021, research released this month revealed.

Although the equity release market has remained strong this year, our research has found that since October, average equity release rates have been rising.

On 7 October 2021 the lowest initial equity release rate (MER) stood at 2.66% fixed, however just over a month later on 11 November, the lowest rate was 2.8% variable, with the lowest fixed rate standing at 2.96%.

To help homeowners decide whether a lifetime mortgage is right for them, below we’ve highlighted some of the most competitive rates available this month.

The plans highlighted below are not endorsed by Moneyfacts.co.uk but have been chosen as they offer competitive rates for the scenario that we have selected. It should be noted that other plans are available that offer similar competitive rates but may offer incentives, such as cashback, that suit the borrower’s needs better – as such borrowers should speak to an equity release broker who will be able to select the best plans for individual requirements.

The most competitive rates that have been available over the previous few months are starting to disappear from the charts, which is impacting those with a large deposit or who own a high amount of equity in their home. Alternatively, those with smaller deposits, including first-time buyers, will see that rates have become more competitive in recent weeks and new, lower rates, are now available in our first-time buyer charts.

Although we’ve highlighted the lowest rates across our mortgage charts, borrowers should always keep in mind that the lowest rate may not be the best, or most cost effective, deal for them. Instead, it is important to consider factors such as product fees and incentives when comparing mortgage deals, as these can have a significant impact on the cost of the mortgage. Consumers unsure of which deal is right for them should consider speaking to a mortgage broker, who will be able to provide advice on the best deal for their circumstances.

The Bank of England continues to send signals that base rate may rise before the end of this year, which, if it does take place, will likely start impacting variable rate mortgages within weeks.

For many mortgage borrowers on a variable rate mortgage the best option may be to lock into a fixed rate deal while rates remain low. Some borrowers, however, may be tempted to remain on a variable rate mortgage, especially as some are currently offering lower rates than fixed deals.