Long-term fixed-rate mortgages ‘too limited’

Consumers are being deterred from long-term fixed-rate mortgage deals, reveals a new study.

According to research by YouGov for the Council of Mortgage Lenders (CML), although 43 per cent of people would prefer a medium or long-term deal when considering a fixed-rate deal, there are a number of factors which put them off.

Consumers raised concerns over interest rates, limitations in refinancing and leaving the deal, and also claimed they had worries about being with one lender for a long period of time.

Although many people may move between short-term to medium-term fixed rates, there is unlikely to be an increase in the number of long-term deals taken up, said Bob Pannell, CML head of research.

CML senior policy adviser Rob Thomas commented: “Measures that would trigger really significant demand for long-term fixed rates are potentially controversial or costly.”

The firm recently announced that the mortgage industry was “holding up”, despite a number of preliminary surveys predicting a dramatic drop in mortgage approvals.

© Adfero Ltd

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