How do 3 year fixed rate mortgage products compare to a longer term fix.
How does a 3 year fixed rate mortgage compare with more commonly offered 2 year or 5 year loans. Call Deal Direct for advice, we can help you decide which product suits you best and find you the best rates in the market.
According to statistics 2 years is the most popular period to fix and generally offers the lowest rates. A 2 year fix offers the security of consistent monthly payments but the flexibility of being able to look for another deal in 2 years time. Compared to 2 year fixes, 5 year rates tend to be higher but offer longer term security of fixed payments.
So where does this place 3 year fixed rate mortgage products as the in between option? While rates for 3 year fixed products may be slightly higher compared to 2 year rates, often the fees are quite similar. Some lenders 3 year rates can compare favourably with lenders 2 year rates, so if you want a slightly longer fix there are some good deals.
The cost comparison of fixed terms depends on what happens to interest rates. Fixed rates tend to be slightly higher than trackers because you are paying a premium for certainty. However predictions that the Bank of England base rate could stay low for a further two years could make the fixing for longer than 2 years more attractive than for a shorter term.
Whether you are looking for a 2 or 3 year fixed rate mortgage, or a longer term product call Deal Direct. As whole of market advisers we can compare rates and fees for fixed rates products from different lenders to find you an offer at the most competitive rates available.
