Best mortgages to start 2014
Mortgage rates are low at the moment, so if you're in the market here's where to start looking.
If you’re in the market for a mortgage, either because you’re buying a property or remortgaging, the good news is interest rates are low at the moment.
That’s mostly thanks to the Funding for Lending scheme, which made cheap credit available to banks and building societies on the proviso they lent the money out to borrowers.
But those particular taps are being slowly turned off, so it might pay to act sooner rather than later to secure a low-rate mortgage.
Let’s take a look at the top mortgages out there right now, based on a combination of both initial interest rates as well as the important fees and charges.
The examples below are for a mortgage of £200,000 taken out on a 25-year repayment basis. I've looked at various different maximum loans to value, which is the percentage of the home's value you want to borrow.
Fixed rate mortgages
In lots of cases, fixed rate mortgages are now cheaper than lenders’ standard variable rates (the rate you move on to at the end of your initial fixed rate or tracker period). Here are the cheapest two-year mortgages now.
|
Maximum loan to value |
Lender |
Initial interest rate (APR) |
Lender fees |
|
60-65% |
1.99% |
£295 |
|
|
70% |
1.99% |
£999 |
|
|
75% |
2.29% |
£499 |
|
|
80% |
2.39% |
£299 |
|
|
85% |
2.69% |
£0 |
|
|
90% |
3.99% |
£0 |
|
|
95% |
4.79% |
£99 |
And here are the top five-year rates.
|
Maximum loan to value |
Lender |
Initial interest rate (APR) |
Lender fees |
|
65% |
2.84% |
£295 |
|
|
75% |
2.84% |
£975 |
|
|
80% |
3.69% |
£0 |
|
|
85% |
3.69% |
£0 |
|
|
90% |
4.39% |
£574 |
|
|
95% |
4.99% |
£99 |
Check the latest mortgage rates
Offset mortgages
If you have plenty of savings and so want to use them as part of an offset mortgage (which can be a good idea given how low savings rates are right now) here are the top two-year fixed rate offset deal.
|
Maximum loan to value |
Lender |
Initial interest rate (APR) |
Lender fees |
|
65% |
2.04% |
£875 |
|
|
75% |
2.39% |
£475 |
|
|
80% |
2.44% |
£975 |
|
|
85% |
2.99% |
£999 |
|
|
90% |
4.69% |
£1,499 |
|
|
95% |
4.89% |
£845 |
These are the top five-year fixed rate offset mortgages.
|
Maximum loan to value |
Lender |
Initial interest rate (APR) |
Lender fees |
|
60-75% |
3.09% |
£475 |
|
|
80-85% |
3.95% |
£999 |
Variable rates
Taking out a variable rate mortgage is always something of a gamble, although you would have been quids in had you speculated four years ago when the Bank of England cut the Base Rate to a record-low 0.5%.
Opinion is divided on just when interest rates might start to rise, but the general consensus is it won't be this year.
|
Maximum loan to value |
Lender |
Initial interest rate (APR) |
Lender fees |
|
60% |
1.99% |
£99 |
|
|
65% |
2.09% |
£999 |
|
|
75% |
Santander |
2.49% |
£495 |
|
80% |
2.79% |
£499 |
|
|
85% |
2.85% |
£0 |
|
|
90% |
4.19% |
£0 |
See how much a mortgage could cost you and get help from an expert mortgage adviser
This article aims to give information, not advice. Always do your own research and/or seek out advice from a regulated broker, before acting on anything contained in this article.
Your home or property may be repossessed if you do not keep up repayments on your mortgage.
More on mortgages and property:
Seven reasons mortgage lenders turn you down
lovemoney Awards 2013: best mortgage provider
Help to Buy mortgages explained
The best Help to Buy mortgages
What 2014 has in store for house prices
Comments
Be the first to comment
Do you want to comment on this article? You need to be signed in for this feature