Available at a rate of 5.49 per cent, fixed until November 2026, it is thought the product is one of the longest fixed rate terms currently available on the market.
It is available up to 90 per cent loan-to-value (LTV), with a minimum loan of £15,000, to the maximum of £250,000. A completion fee of £499 exists on the product, with its early repayment charge (ERC) diminishing from 6 per cent, to 1 per cent over the 20 year term.
Commenting on the launch of the fixed rate product, Steve Urwin, AGM marketing and new media at Newcastle Building Society, said: “This 20-year fixed rate mortgage is the longest fixed rate product Newcastle BS offers its customers. It is ideal for borrowers who want to fix their mortgage loan repayments for a substantial period with the additional peace of mind that they will not be affected by any further movements in the Bank of England Base Rate.”
He confirmed the product was available through its branches and call centres, and through brokers, although Newcastle BS would not pay a procuration fee to the intermediary.
James Cotton, mortgage specialist at London & Country, admitted that long-term fixed rate deals were becoming more popular. He said: “Long-term deals have become a lot more competitive, but borrowers have to realise that they are trading flexibility for stability, especially with this product. The rate is quite good, although there are a number of 10-year fixed rate deals below the 5 per cent mark.”
He added: “It is understandable that the ERC is for all of the 20 years, but the fact that during the final five years that it is only 1 per cent is a good option. Borrowers need to look at their own situation and decide if a term as long as this suits them.”
