What You Need to Know About a 5 Year Fixed Rate Mortgage

The beauty of a 5 year fixed rate mortgage is, despite soaring interest rates or potential economic upheavals; you will know exactly what you have to pay for the next 5 years. This offers major peace of mind for those on a low income or who have been suffering financial difficulties.

A 5 year fixed rate mortgage is well suited for first-time buyers, who will appreciate the stability of the payments especially as their initial outgoings will be high. As with any other mortgage, fixed rate mortgages are usually subject to status and certain lending criteria.

One of the United Kingdom's leading lenders Santander offers a variety of fixed rate mortgages, ranging from one year to five years. Their interest rate is 2.55%, fixed for two years with the option for a 5 year fixed rate mortgage open to certain individuals. This mortgage requires a 25% deposit from the lender, but there are no additional booking fees to pay.

Another popular lender Nationwide have prided themselves on the fact their interesting rates have been dropping, as much as 50 percentage points in some cases. Although they do offer lenders the option of a 5 year fixed rate mortgage, their most popular mortgages are fixed for two or three years. Their 2.89% APR rate is extremely competitive; however, they do charge a booking fee as well as a £400 product fee.

Before committing to a 5 year fixed rate mortgage you should seriously consider your financial circumstances. If you cannot afford the payments on your mortgage, you run the risk of losing your home as a result.

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