Considering a 10 year fixed rate mortgage? What are the pros and cons?

A 10 year fixed rate mortgage could be the right deal if you are looking for long term security. Fixed rate periods of 10 years + are usual in many European countries but in the UK they have failed to catch on.

However during periods of economic instability longer term security is something that is highly prized.

The advantage of a 10 year fix is knowing what your repayments will be long term which helps you to better plan your financial future. If mortgage rates significantly rise during your fixed period then you will be protected from any increase.

So if 10 year fixed rate mortgages are a really secure deal why don't more mortgage-holders choose this option?

As well as the upside there is a downside. If rates fall during your fixed period you may not be in a position to remortgage and switch to a lower rate.

Remortgaging to a cheaper rate becomes more costly if you have an early redemption clause attached to your mortgage. Therefore when considering a 10 year period choose a product with no ERC.

10 year fixed rate mortgages also tend to be priced higher than 2 and 5 year fixed rate deals, for some this premium is worth paying. However it is important to remember that peace of mind comes at a cost, and 10 years is a long time.

A lot can happen in a decade, therefore before making any decision as to which length mortgage term you should choose seek out some impartial mortgage advice.

An independent 'whole of market' broker will offer mortgage recommendations and advice based on your financial needs.

To discuss the merits of a 10 year fixed rate mortgage call an adviser at Deal Direct.

Call 0800 048 8828 for advice and a low rate quote.