Mutual launches mortgage rate at under 1%

June 12, 2015 by Brendan O'Neill

Rates

As the battles between lenders rages on, Chelsea Building Society has recently offered a deal that tracks the Bank of England (BoE) at 0.48 above base (at present 0.5%), making it an exceptionally low rate.

At just 0.98%, it is the first under 1% and tracks the BoE for a period of two years. Borrowers need a deposit of at least 35% to be eligible. It costs £1,545 to reserve the product and £130 to process the application.

It would be important for people looking at this deal to factor in the benefit of the low rate against the £1,675 cost of getting the mortgage set up.

Rachel Springall of Moneyfacts.co.uk explained:

“Breaking the 1% barrier is sure to grab the attention of borrowers looking for a competitive rate on their mortgage.”

She added that this was probably the lowest ever tracker, and that there was a strong chance that fixed products could drop to less than 1% as well.

It has been predicted by economists that the base rate will not rise until around the summer of 2016, instilling a confidence in banks to release lower rates.

As rates continue to sit at record lows, there has never been a better time for people to reassess their current mortgage needs and the rate they are paying, as it may be beneficial to move to another lender.

Having qualified after your CeMAP training, you will be in a position to assess affordability and advise on the most appropriate mortgage solution for your customers.