Thursday, August 11, 2011
Borrowers still have the whip hand
The average five-year fixed rate mortgage has dropped below 5% for the first time since Moneyfacts started recording rates in 1988, with further falls expected this year. Moneyfacts figures revealed today that the average five-year fixed rate mortgage stands at 4.99%, down from a recent high of 6.24% in September 2009 since base rate fell to 0.5%. In addition, average two-year fixed rates have fallen from 5.18% in September 2009 to 4.24% today, while the average three-year fixed rate has dropped from 5.61% to 4.74%. Moneyfacts highlighted that the cost of funding fixed rates through the swap rate market has dropped to an all-time low, leading to some of the lowest mortgage rates ever on offer.