Locking into a fixed rate mortgage of 10 years or more may be tempting for those looking to secure their monthly mortgage repayments against the risk of rising rates, but long-term fixed deals may not be a good choice for mortgage borrowers.
Right now there are 333 fixed mortgages deals with terms of 10 years or more. Many of these, 161 deals in total, are available on terms that are fixed for life or term. Meanwhile, 158 deals are available on a 10 year term, eight fixed for 15 years and six deals are for a 20 year term.
Clearly, mortgage borrowers have a range of products to choose from if they want to take out a long-term fixed rate mortgage.
Although most deals are available to those with a high deposit or equity in their home some, including 40-year term deals launched by Kensington Mortgages this week, are available to first-time buyers with just a 5% deposit.
The rates on long-term fixed rate mortgages are normally higher than those on two, three and five year fixed terms. Some mortgage borrowers, however, are happy to pay a higher interest rate to have the security of knowing what their monthly mortgage repayments will be for the term of the mortgage.
Along with a fixed repayment for the length of the mortgage term, locking into a long-term mortgage can save money, as borrowers do not need to pay fees and charges remortgaging every few years.