Coventry has cut rates across its range of five-year fixed residential rates at 90 per cent loan-to-value by up to 0.16 percentage points.
Highlights include a 2.69 per cent fix with a £999 product fee and a 3.05 per cent fix with no fee, both of which come with early repayment charges (ERCs).
Alternatively borrowers can opt for a 3.05 per cent fix with no ERCs and a £499 product fee.
Demand for five-year fixes could be set to grow amid heightened expectation of a rise in the Bank of England’s base rate, which has been at a record low of 0.25 per cent since August 2016.
The Coventry was one of several lenders which recently increased rates on their residential fixed rates, including raising five-year fixes by up to 0.2 percentage points.
Kevin Purvey, director of intermediaries, said: “We’re excited to reduce rates across our 90 per cent loan-to-value five-year fixed range. With rates starting from 2.69 per cent, borrowers can take advantage of the certainty of a fixed mortgage payment for the long term.
“In addition, all of our products are application fee free and include a valuation of up to £670 for residential mortgages. We also offer £500 cashback on fixed residential completions for first time buyers and home movers and our ‘Remortgage Transfer Service’ for remortgages.”
Kevin Dunn, mortgage and protection adviser at Leicestershire-based Furnley House, said he was wary of encouraging clients to opt for five-year fixes.
He said: “It is good news that the rates are being decreased. You are almost looking at a perfect storm at the moment - coming towards the end of the year, a lot of the lenders are trying to hit their sales targets, so there are a couple that are cutting still, which is great.
“I am always wary about fixing for long periods – it is about what is right for the client. If you think about what you were doing five years ago, you might have had a different house and a different partner.
“The one with no ERCs is fairly competitive at 90 per cent loan to value, but then if you went for a two-year deal you would hope the house price edged up a little bit and then you could go for an 80 to 85 per cent deal."
simon.allin@ft.com
