Halifax Intermediaries has unveiled a new five-year mortgage for first-time buyers, homemovers and remortgage customers up to 60 per cent loan-to-value.
Five-year fixed-rate loans are now available at 2.39 per cent with a £1,499 product fee.
The rate is 2.54 per cent for remortgage customers with a 40 per cent deposit.
In addition, the five-year fixed-rate mortgage also at 60 per cent LTV, have been discounted by 0.4 of a percentage point from 2.54 per cent with a £999 product fee.
For remortgage customers, the loan is available at 2.29 per cent.
Five-year fixed rate products up to 75 per cent LTV have been reduced to 2.93 per cent and 2.95 per cent for remortgage customers – both with a £999 product fee.
Furthermore, five-year fixed-rate mortgages of up to 80 per cent LTV have been lowered by 0.11 per cent with rates from 3.59 per cent, also with a £999 product fee.
Last month, Halifax made cuts of up to 0.6 of a percentage point across a number of its two-year fixed-rate mortgages, up to 60 per cent loan-to-value.
This includes a 0.25 percentage point reduction on two-year fixed-rate products for first-time buyers and homemovers with rates from 1.59 per cent, with a £1,995 product fee.
Provider view
Ian Wilson, head of intermediaries at Halifax, said: “Halifax is committed to providing competitive products and great service to the intermediary market. The launch of these new five-year fixed rates and the reduction of rates within our five-year range, demonstrates our ongoing dedication to helping Britain prosper and saving our customers money when they take out a mortgage with Halifax. It will also enable us to continue to support our first-time buyer commitments and support intermediaries across the entire mainstream market.”
Adviser view
Matthew Harris, director at Dalbeath Financial Planning, based in Fife, said: “There are deals out there right now that offer a similar rate of interest but with a cheaper product fee – that is not to say this new five-year fixed loan is the worst product out now.
“The option with a lower product fee but with a slightly higher fixed rate would suit those with bigger mortgages.”
He added: “I think it is looking like there is a demand for longer-term deals. We tell our customers to think twice before signing a five or 10-year deal. Long-term deals may protect you from interest rate rises but it can come at a large cost to your monthly mortgage repayment for a long period of time.”
Charges
Product fee ranges from £999 to £1,499.
Verdict
Even though a rise in base rates is yet to materialise, many lenders have launched longer-term fixed-rate loans or have discounted their existing offerings. The reduced fixed rates across the range of five-year products for people with small and large deposits is a clear indication of the lender’s attempts to entice a wide range of customers to its offerings.
However, remortgage customers might feel hard done by, as they have to pay a slightly higher rate of interest than first-time buyers.
Whether a long-term mortgage represents a good deal remains up in the air. Those who opt for such a loan will have to pay a rate of interest which is considerably higher than two-year fixes. However, they would also escape the effect of a rise in base rates.
