In recent weeks, you’ve read about the mortgage price war that has seen many lenders reduce the cost of borrowing to below 1%.
However, one of the issues with these ultra-low rates is that they are typically only available for a short period. Indeed, new research from Moneyfacts has revealed that the average mortgage deal in the UK is now available for just 21 days.
These “blink and you miss it” offers come and go quickly and so it’s essential that you move fast if you want to secure the rate you want. Read on to find out why these deals are coming and going so quickly, and how working with us can help you to secure a low-cost deal.
Shelf life of mortgage deals is at its shortest on record
Moneyfacts research shows that the shelf life of a mortgage deal is at its shortest ever with ultra-low interest rate deals “selling out” in record time.
The typical mortgage product is now available for just 21 days before being withdrawn, according to the data. This is the lowest on record, and the time taken by lenders to pull their deals has fallen by nine days, on average, in the last month alone.
So why are lenders withdrawing these products so quickly?
One reason is because of the strong competition in the mortgage market. Lenders are keen to attract new business, so offer cheaper and cheaper loans in order to court new borrowers. As rivals then undercut their products, they are forced to quickly re-price their deals in order to remain competitive.
In addition, lenders typically have a fixed amount of money – sometimes called a “tranche” of funds – that they are prepared to lend at a certain interest rate.
This is often restricted to tens of millions of pounds. Once the lender receives applications equivalent to the value of the tranche, they will typically then withdraw the deal as they essentially “sell out” of the product.
As of 1 September 2021, low-cost deals available include a 0.84% two-year fixed-rate product with TSB, available to 60% loan-to-value with a £995 fee. Other lenders offering products below 1% include Santander, HSBC, Barclays, NatWest, Nationwide, and the Yorkshire Building Society.
Working with us can help you secure the low-rate deal you want
In an environment where lenders are withdrawing popular mortgage products at short notice, it can be frustrating if you’re looking to secure a low-rate deal.
In addition, lenders who offer a “best buy” mortgage often then struggle to process the volume of applications they receive in a short space of time. This can be frustrating for borrowers who then endure delays – particularly if you’re on a tight timescale to move home or to get your remortgage completed.
If you want to secure the best deal, it can often pay to work with a professional such as Altura. There are several reasons for this.
You’ll get regular updates about new deals
When we know exactly what your mortgage requirements are, we can keep you updated with any new deals immediately a lender releases them.
You’ll get an update with brand-new products, giving you the opportunity to act before they “sell out”. This is particularly important at a time when many deals are lasting an average of just three weeks.
You can move quickly to avoid missing out
Working with a broker can help you to avoid missing out on the best mortgage deals. We can help you to move quickly and to get your application to a lender in plenty of time, ensuring you don’t miss out on the deal you seek.
In addition, we’re often in a position where we can “reserve” funds with lenders, enabling you to benefit from the low-cost deal you want. We have wide experience in helping clients to secure deals before they are withdrawn.
We can ensure your offer is valid as long as you need it
Reserving a mortgage deal is no use if the mortgage offer is likely to expire before you want to complete your remortgage or property purchase.
As we work with dozens of lenders across the market, we know which lenders produce offers that can be valid for up to six months, as opposed to some lenders who only issue offers valid for three months.
This can be particularly useful if you want to secure a really low-cost deal, but your existing mortgage product doesn’t expire for several months.
You can effectively reserve one of the current ultra-low-rate deals now, and complete on your remortgage in several months’ time once your existing rate has come to an end.
Get in touch
If you’re looking to benefit from one of the low-rate mortgage deals currently available, please get in touch. Email info@alturafin.com or call us on +44 (0) 20 3411 0079.
