Banks and building societies are wooing creditworthy borrowers with long-term fixed-rate mortgages. In the latest salvo in the home loan price war, lenders are slashing the rate on this kind of finance to less than 4 per cent — and even offering decade-long fixes to first-time buyers with only a 10 per cent deposit.
Two lenders — The Co-operative Bank and Britannia — cut their rates on 10-year fixed deals this week by 1 percentage point.
Aaron Strutt, of Trinity Financial, the mortgage broker, says: “Lenders are in a better position to offer ten-year fixes, partly as mortgage funding is so cheap, but also because of the increase in competition. More of the banks and building societies are fighting for business and this is helping to drive down rates.”