15 year fixed mortgage rates - an answer to increased financial stability?
Could 15 year fixed mortgage rates be an answer to home-owners financial stability?
UK mortgage terms usually run for 25 or sometimes 30 years, but a typical fixed rate period is usually 2 to 5 or occasionally 10 years, before reverting to a variable rate.
For many home-owners 15 year fixed mortgage rates could be a risk, to fix for 15 years only to see rates slip below the level fixed would result in their paying considerably over the odds. Long term fixed-rate mortgages have been offered in the past but with limited consumer demand.
For a home-owner, the first thing to think about is repayments. Lenders are not charities, they exist purely to make money and so will never offer long-term fixed rate deals at levels they think will lose them money. By deciding on a long term fixed rate mortgage, a home-owner will be with their lender for a considerable amount of time. 15 year mortgage rates mean less flexibility to move to another deal and make early repayments but they do give a home-owner security and peace of mind.
For home-owners accepting such deals it will be necessary to close their eyes and ears to other lenders rates over the fixed period, as early repayment charges on 15 year fixed mortgage rates can be considerable and could cancel out any savings that would be made by switching.
