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Mortgages - Woolwich launches 10-year fix
Woolwich has launched a new 10-year fixed rate mortgage at 5.29%. Available to both new and existing customers, the loan, which comes with a maximum LTV (loan to value ratio) of 60%, has an arrangement fee (which can be added to the loan) of £995. Once the fixed rate period expires the loan will revert to a tracker at base rate + 0.95%.
Borrowers can overpay by up to 5% p.a. without any charges during the fixed rate period. They may also underpay or take payment holidays. However, during the fixed rate period an early repayment charge of 6% will be in force.
Customers switching from another lender can use Woolwich's Switch & Save package with no valuation and legal costs.
The initiative comes as official figures from the Council of Mortgage Lenders suggest over 1.7 million borrowers will be coming off fixed rate mortgages in 2008. The vast majority of these are currently on rates at levels below base rate at 5.25%, whereas most current mortgage products are above base rate, leaving a potential funding gap for millions of borrowers.
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