Stability 'key' for remortgages
Published On 28 November 2007
A significant proportion of homeowners in the UK prioritise stability when choosing to remortgage, according to a new study.Research carried out by Abbey found that almost one in three mortgage-holders would opt for a five-year fixed-rate mortgage if they were to remortgage today.
That accounts for 5.1 million people, with a further 1.1 million saying they would tie themselves to a loan for ten years and 1.5 million preferring a 15-year deal.
With the Bank of England's base rate currently at 5.75 per cent, a rate cut is anticipated to happen soon - but the homeowners polled were looking for security.
Some 65 per cent of the 8.8 million respondents told Abbey they like to know exactly how much their mortgage will cost them month-to-month. Another 700,000 said they did not sufficiently understand tracker mortgages.
"You never know what's going to happen in the future, but at least if you've committed to a long term fixed deal, you know where you are going to stand with your repayments," said Nici Audhlam-Gardiner from the bank.
"Borrowers need to be sure however that the deal they take out is right for them and that they understand the different types of mortgages available before signing up to anything."
A study from Lloyds TSB found earlier this year that 60 per cent of homeowners polled thought interest rates would fall in the near future, but one in five would not risk a tracker mortgage.
