Brexit has led to a huge increase in the number of British citizens looking for a 10 year fixed rate on mortgages. Uncertainty concerning Brexit, low interest rates, and a likely increase in interest in the future are all factors driving clients’ desires for long-term fixed rates. Banks and lenders will not always offer the 10-year fixed rate and when this deal is offered, it also comes with fees and up front costs. Economists in Britain are looking at importing the US-based system of fixed rate mortgages but this is often unpopular with banks in Britain who do not want to be locked into a rate for the life of a mortgage.

Key Takeaways:

• Borrowers in England are increasingly looking for fixed rates instead of trying to take advantage of variable rates.
• Deals that have a margin between 10 and 5 years are catching the interest of borrowers. Fixed mortgages at decades long terms are becoming popular for the first time in Britain.
• Borrowers must make sure to examine their circumstances to know if they will continue to be able to afford the rate they are locked into. Some borrowers still want to take chances on variable rates.

“Brokers say uncertainty over Brexit negotiations, ultra-low rates and the likely future trajectory of interest rates are encouraging borrowers to consider fixing rates for a decade.”

Read more: https://www.mortgagestrategy.co.uk/cover-story-locking-longer-future-fixes/