Skipton Building Society has introduced new reductions across fixed mortgage rates, along with launching a new 3-year fixed range of products.
Available from 9am tomorrow, Tuesday the 12th of September, the Society will introduce reductions across its residential, buy-to-let, new build and Government scheme product ranges.
Skipton also informed lenders of its decision to reprice selected tacker deals.
In light of this announcement, Newspage sought the views of brokers as to whether this is start of another week of mortgage rate cuts and if these 3-year fixes are becoming more popular with borrowers.
Reaction
Justin Moy, managing director at EHF Mortgages:
“It’s encouraging to see another week kick off with more rate reductions, and the introduction of the 3-year fixed range will interest borrowers and brokers alike, especially with market speculation that rates will stay higher for longer.
“Tracker margins are priced a little better but the fixed rate reductions are small and are not going to have any significant impact on the market unfortunately.”
Gary Bush, financial adviser at MortgageShop.com:
“It’s been a good two weeks for lender fixed-rate reductions, fuelled in part by the Governor of the Bank of England’s comments that rates may be nearing their peak.
“In the current climate, three could be the new two for many borrowers as 3-year fixes come in slightly cheaper and don’t lock you in for as long as a 5-year fix.”
Elliott Culley, director at Switch Mortgage Finance:
“It’s positive to see more lenders offering 3-year deals and giving more choice in the market to clients.
“With forecasts saying rates may stay higher for longer, 3-year fixed rates may become more popular.
“They may also be more attractive to borrowers as they are slightly cheaper than 2-year fixed rates and don’t tie you in for as long as 5-year fixes.”
Richard Campo, founder at Rose Capital Partners:
“Skipton cutting rates is just par for the course for the remainder of the year, which makes it exceptionally difficult for borrowers and indeed advisers to find the best product.
“The rate cuts are being driven by falling money markets and a slow property market, which means lenders have to compete with each other to win business, which drives down costs.
“In the main, we are recommending penalty-free trackers to our clients so they can either ride the market down if the Bank of England starts cutting rates as expected next year, or they can opt to switch to a fixed rate as and when fixed rates bottom out.
“I think anyone taking a longer-term fixed rate right now will look back on that in three, four or five years’ time and perhaps feel they are paying over the odds.
“That said, everything can change in a heartbeat if something unexpected happens.”
