A report by the BBC has claimed people borrowing money on ‘lowest ever’ mortgages could be stung by the small print.
Experts have said that banks and lenders might be charging less on monthly interest, but that there could be steep rises in rates once the term of the mortgage is up. They are also advising people to check the set-up fee, which can be hundreds of pounds, and not just look at the interest rate.
Rachel Springall of Moneyfacts told the BBC: "These rates come at a cost. If you think you are going to have to move your mortgage again in two years time, you've got to think whether you are going to have to pay another fee.”
Meanwhile the price war among lenders continues. Co-op is offering a rate of 1.09% to borrowers with a 40% deposit (beware however: this rises to 4.74% at the end of the term).
According to the BBC report, economists expect the Bank of England to maintain base rates at their current low of 0.5% until February 2016.
For professional advice you can trust call Outlet’s money team on 020 7287 4244 or click here for more financial planning information. And if you are looking to buy, a goos starting point could be one of the many new homes in London.
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