Jun 10
2
According to a recent survey, fixed rate mortgage deals are going to outstrip the popularity of tracker mortgages over the coming months. This is due to changes in interest rates, the average rate for a two year fixed rate loan having dropped from around 5.21% to 4.61%. This change has seen the average mortgage repayment amount fall by as much as £52 per month, which is welcome news for Colchester residents.
As the mortgages available become more competitive between lenders, it seems that the property market in Colchester will be able to follow suit after a period of being a primarily rental market. There is a selection of new build apartments on the market that are suitable for single professionals and families, but because it has been difficult getting a mortgage approved, especially for first time buyers, these properties have been on the market for a while.
The popularity of fixed rate mortgage deals is only expected to last for the next six months, and could well be a sign that borrowers are uneasy about potential changes in interest rates due to the current political climate. This has been reflected in the interest in short term mortgage deals as opposed to longer term fixed rate options. With interest rates at a favourable level, locking into a plan for two years is an attractive option; this short term commitment will bring financial security to borrowers until the financial markets find an even keel.
One of the best short term fixed rate mortgage deals available to Colchester residents at the moment is offered by the Cooperative Bank. The two year fixed rate 75% LTV mortgage has an interest rate of 2.95% and 4.1% APR, with the interest reverting to 4.24% after the initial 2 year term. This mortgage deal comes with an £849 arrangement fee, a £140 booking fee and can be used for loans between £5,000 and £1.5m.
