Coventry Building Society is preparing to launch the lowest 10 year fixed mortgage ever recorded, with a rate of just 2.39% at 50% loan to value (LTV), following the tumbling prices of medium to long-term rates from many lenders since the UK’s decision to leave the EU.
The product is one of many rate cuts in a refreshed line of fixed products from the lender, which comes with a £999 product fee, or an alternative fee-free option, which comes with a rate of 2.69%. The numerous price cuts from the lender are largely due to the fall in swap rates, allowing borrowers the opportunity to offer market-leading rates to people looking for longer-term security in a more uncertain market.
Coventry’s 10 year fixed, does however, come with early repayment charges for the term of the product, so those looking to redeem before the product expires will be required to pay 5% of the mortgage balance during the first 2 years, 3% for the next 3 years and 1% for the remaining term.
10 year fixed terms have become increasingly popular amongst lenders, as they provide a much longer term of security as well as a fixed monthly mortgage payment. This is likely to continue as the future of the market remains relatively uncertain.
The lowest 10 year fixed available previous to this, was Leeds Building Society’s 2.84% deal at 65% LTV, with a fee of £1,499. TSB also offers a 10 year fixed rate currently available up to 60% LTV, yet this comes with a slightly higher priced rate of 3.19% with a product fee of £265.
Elsewhere, HSBC launched the lowest ever 10 year fixed rate available at 70% LTV, with a rate of just 2.79%. An 80% LTV option is also available with a rate of 2.99%, both with no product fee.
The new range comes with free standard valuation fees for both purchase and remortgages, as well as free standard legal fees for remortgages.