Skipton Building Society
Type: Fixed-rate mortgages
Description: Skipton Building Society has refreshed its range of three-year and five-year fixed-rate mortgages, and cut some rates by up to 0.31 of a percentage point.
The cheapest rate is 3.95 per cent fixed for three years for borrowing up to a maximum of 75 per cent LTV. Five-year rates start at 4.18 per cent for 75 per cent LTV.
Borrowers who require 90 per cent LTV will pay 5.89 per cent whether fixed for three or five years.
Rates are fixed until 30 September in either 2015 or 2017, and interest reverts to the Bank of England base rate plus 4.45 percentage points afterwards. It is currently 4.95 per cent.
Free legal work and valuation are available for remortgages.
Conditions: The deals come with a £195 application fee and £800 completion fee. Overpayments of up to 10 per cent a year are allowed without penalty. Otherwise early repayment charges will be the interest due to the end of the month, plus 3 per cent of the capital repaid for the three-year deals. The five-year deals have a yearly-decreasing rate from 5 per cent to 1 per cent.
Craig Taggart, head of mortgages for London-based IFA Baigrie Davies, said: “Nothing here is market leading. It is a step in the right direction by Skipton, but nothing to get excited about.”
Mr Taggart questioned whether borrowers would gain any value, apart from peace of mind about payments from fixing their mortgage rate for three to five years.
He said: “In the current climate it looks like the base rate will be low for the foreseeable future, so tracking may provide better value.
“When rates do start to rise, I imagine it will be a long, drawn-out process, so rates in say two years’ time are unlikely to be as high as five-year rates today.”