Fixes pull 'disappearing act'

Julia Harris, mortgage analyst at Moneyfacts.co.uk, commented: “The last week has seen many lenders launching new fixed rate deals at higher rates, including some of the largest mortgage providers such as Halifax (+0.30%) and Northern Rock (+0.10%). With several other lenders withdrawing all or selected fixed rate deals completely. These include:

• Bank of Ireland Mortgages - All prime fixed rates
• Birmingham Midshires - Fixed rates with additional 30% LTV
• Dudley BS - 5-year fixed
• Portman BS - 100% LTV deals “Perhaps the reason behind this is simply that they have used their fixed rate funds, or are taking time out to reprice depending on the base rate decision this week. But the examples of Portman BS and Birmingham Midshires may show a more worrying trend.

“A few weeks ago HSBC announced it would be lowering its maximum loan-to-value, and with the second two institutions now withdrawing their higher risk deals, is it a sign that lenders are beginning to adopt a more cautious approach?”

Mortgages – the best of both worlds

“With uncertainty still rife as many industry experts predict another rate rise is on the cards, the launch of products from Skipton & Woolwich offering different ways to ‘hedge your bets’ is perfect timing.

“Woolwich ‘fix and track’ range offers borrowers the option to fix at a competitive 5.39% for one year, with the option to revert, free of charge to a lifetime tracker (BBR + 0.39%). The drop lock deal has no ERC, is available up to 80% LTV and charges an initial £595 fee.

“By comparison the Skipton BS’s new range allows borrowers to mix and match from a selection of fixed rates, base rate trackers, discounts and capped rate products. So by choosing the mix of fixed and variable rates, it’s an ideal way to tailor your mortgage towards your expectations of further rate changes. With a large range of rates, terms and fees available, borrowers have a great portfolio from which to choose.

“Borrowers who want to speculate against future base rate moves, to protect their repayments in the short or longer term, or who would like a slice of security but still take advantage of any rate reductions, will find these products are a welcome addition to the mortgage market.

“It is great to see an innovative approach to rates reaching the marketplace."