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Borrowers looking for longer-term fixes
3 July 2008 11:30
A high proportion of homeowners would fix their repayments for at least the next five years if they were to switch to a new mortgage now, according to a new survey.
In June, over one in four borrowers said they would select a five-year fixed-rate if they were to remortgage, Abbey's poll showed, compared to only one in nine who would have chosen a three-year fix and just over one in 20 who would have opted for a two-year one.
Meanwhile, whereas barely over one in 20 would have switched to either a ten or 15-year fixed-rate in May, the same amount would have selected a 15-year fix alone last month, while almost as many would have plumped for a ten-year fix.
By contrast, few borrowers would choose to link their mortgage with the base rate in the current economic climate, with just one in 25 willing to switch to a two-year tracker and only another one in 25 saying that they would choose a flexible tracker.
Abbey's director of mortgages Phil Cliff said these findings offered an interesting insight into the current mentality of homeowners, who seem to be thinking about the long-term at the moment and do not want to remortgage again until the credit crunch is over.
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