Mortgages  

Leeds Building Society unveils four fees-assisted LTV deals

Leeds Building Society has launched four ‘fee assisted’ five-year fixed-rate mortgages across a range of loan-to-value (LTV) deals

The rate of interest applicable at up to 65 per cent LTV is 2.5 per cent, and 2.65 per cent at up to 75 per cent LTV.

In addition, the product for borrowers with a 20 per cent deposit is priced at 2.69 per cent. The rate is 2.94 per cent at up to 85 per cent LTV.

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Each loan comes with a £199 fee and a free valuation, with fees-assisted legal services for standard remortgages.

Earlier this month, the lender rolled out a duo of loans for the government’s expanded London help-to-buy equity scheme for first-time buyers who are based in the capital.

The lender has also launched a two-year fixed-rate mortgage at 1.79 per cent, with a £799 fee, and a five-year fix at 2.45 per cent with a £199 fee.

Provider view

Martin Richardson, director of business development at Leeds Building Society, said: “Longer term fixed-rate deals are looking increasingly attractive as the likelihood of a change in the bank base rate has receded again.

“With mortgage rates at their current low levels, we’re seeing a lot of interest from remortgagors who can benefit from an extremely competitive rate, and the security of fixing their monthly repayments, before we enter a rising rate environment.

“These products are also available for home purchase – the 80 per cent LTV deal at 2.69 per cent is proving particularly popular with borrowers who have a larger deposit.”

Adviser view

David Wilson, managing director of Newcastle-based NE Money, said: “I would say there has been an increase in demand for five-year fixes – particularly at the back end of last year.

“The demand seems to have dropped off a bit since the Bank of England came out and suggested that a rate rise was unlikely to happen any time soon.

“Some people have since opted for the cheaper two-year fix. Others have also opted to take out a two-year tracker even though they are not that much cheaper than the fixed rate alternative.

“I would say that the two-year tracker option is probably the better deal simply because of the benefit of knowing exactly the value of your monthly repayments.”

Mr Wilson added: “There was a mortgage price war, but I would say that we are seeing less competition when it comes to rates compared to what we saw last year.

“I think the new battle front will be over lending criteria. The mortgage marketplace is in a good position for borrowers at the moment.

“The rates are low and mortgage criteria are becoming increasingly flexible.”

Charges

£199

Verdict

Five-year fixes are desirable to many borrowers at present. Many are looking to fix amid uncertainty over the likely occurance of a hike in interest rates. The same individuals are likely to prefer knowing exactly how much they would be paying every month.