Homeowners will be able to fix their mortgages for 40 years with no early repayment charge as specialist lender Kensington Mortgages looks to take advantage of fears of interest rate rises among borrowers.
The lender will offer the mortgage from this week and is among the first in Britain to roll out such long-term rates. Unlike other long-term fixed rates, savers will not have to pay any charges for paying off their mortgage early if they move home, sell, are critically ill or die. The mortgage can also be transferred to a new property.
This comes after some of the country’s biggest lenders pulled their best deals and made mortgages more expensive in recent weeks, in anticipation of an increase in the Bank Rate.
Dean Esnard of Magni Finance, a mortgage adviser, said long-term fixed rates have remained unpopular as they tend to be more expensive, incurring higher arrangement fees. Kensington Mortgages said it would charge a 0.75pc fee.
Fixed rates for up to 25 or 30 years are new to British borrowers but are more common in France, Germany and America, he said.
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