Mortgages  

Accord Mortgages cuts rates on two-year fixes

Intermediary only lender Accord Mortgages has reduced rates on its two-year fixes for borrowers with a 35 per cent deposit.

A two-year fix is now available for remortgage customers at a discounted ate of 1.87 per cent at 65 per cent loan-to-value (LTV) with no product fee, and a choice of £250 cashback on completion and free standard valuation, or free standard valuation and legal fees.

In addition, a two-year fixed loan for house purchases is available at 1.94 per cent – also with no product fee, and with either £250 cashback on completion and free standard valuation.

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The lender recently announced a reduction in the product fee on selected buy-to-let mortgages by £650 to help landlords looking to remortgage or extend their portfolio.

Mortgages for landlords with product fees of £2,495 have been cut to £1,845, as well as rate reductions on selected fixed rate mortgages of up to 0.3 per cent.

Provider view

David Robinson, National Intermediary Sales Manager at Accord, said: “We are always looking at ways to offer borrowers value for money and believe these mortgages will prove very attractive thanks to the highly competitive rates and choice of incentives.

“We hope brokers looking for competitive deals on house purchases and remortgages will welcome these new rates and pass them on to customers.”

Adviser view

Chris Evans, mortgage adviser at Edinburgh based Hunter Wealth Management, said: “It is a good deal and I imagine the product being very popular. Having a choice of different incentives is designed to persuade borrowers, who would otherwise stay on the standard variable rate, to make a change.

I processed a mortgage application with Accord, and I have to say I was quite impressed with the speed of the service. They have recently increased the mortgage age limit from 65 to 70, and we have seen other lenders like Nationwide do the same in response to greater longevity.

Mr Evans added: “Competition in the mortgage marketplace is still rife. More and more lenders are coming out with new competitive products, or reducing existing offerings in a bid to secure a significant slice of the market.”

“There have been rumours about the direction in which base rates are likely to move for quite some time now. I do not think they will change at any point soon.”

Charges

No product fees payable.

Verdict

Competition in the mortgage marketplace shows no sign of abating. Accord has been particularly active, making a number of reductions to rates across its range of residential, remortgage and buy-to-let offerings. Here, both loans are competitive. The range of incentives will go some way in coaxing borrowers, although those with existing mortgages may take some convincing. The onus is on the provider to convince these individuals that the change would be worth their time and effort of going through the mortgage process all over again.

Lenders have gone an extra step in their quest to find new lucrative avenues in an increasingly congested market by increasing the maximum age for mortgage maturity to offer greater support to borrowers in retirement. The move is commendable, but whether older consumers would be able to borrow money at a time of heightened regulatory scrutiny on affordability and overall lending criteria remains to be seen.