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Lenders offer long-term fixed-rate mortgages

26/03/2008

A recent study has shown that vast majority of lenders are now offering long-term fixed-rate mortgages.

MoneyExpert.com suggested that there were 132 individual fixed-rate mortgage products on the market. The average interest rate on these fixed-rate mortgages had increased from 5.89 per cent to 6.14 per cent through 2007 period.

Sean Gardner at MoneyExpert.com commented: "Long-term fixed-rate mortgages are here to stay. However, even though there is now more choice for homeowners, that choice also comes at a higher cost. Average rates on long-term deals are up, meaning the consequences of making such a big decision are even more severe. If interest rates start to spiral, you’ll be laughing. But if they continue to drop then you could have saved money sticking to shorter term arrangements."

A short time ago, the Council of Mortgage Lenders stated that interest-only mortgages would be a fine option for majority of people, simply because if the borrower is completely aware of the penalty and reappraises, the need to submit in line a plan for the repayment of the amount borrowed over the flow of the loan will be manageable.


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