More people considering long term fixed rate deals

July 12, 2016 by Brendan O'Neill

Borrowers

Recent studies indicate that there are now more borrowers considering a long term fixed rate mortgage as a way to ensure financial certainty for the next 10 years.

According to research conducted by HSBC, 72% of people searching for a home would consider a fixed rate product for a period of 10 years. The main reason is to provide certainty for their financial affairs, guaranteeing a fixed monthly mortgage payment for a decade.

The study also suggested that the people most likely to consider this type of deal are those aged between 18 and 35, or Generation Y. Just under 80% would consider a fixed rate product for 10 years.

Statistics showed that 71% of people living in London would consider a fixed rate mortgage. However, just 51% of people in Yorkshire and the Humber would consider a 10 year fixed rate product, while borrowers in the north east are slightly more likely to apply for a decade-long fixed rate mortgage, at 62%.

The head of mortgages for UK HSBC, Tracie Pearce, said:

“10 years might seem like a lifetime away, yet our research shows that we like to plan ahead and are currently looking for security.”

She added that being able to fix a mortgage rate for a longer period offers security and certainty for borrowers, so that their monthly mortgage repayments won’t increase during that time.

Mortgage advisers have to pass their CeMAP exam before being permitted to advise customers. This ensures that they can offer the best advice when searching for the most suitable mortgage for your circumstances.