HSBC has launched a 10-year fixed mortgage at an interest rate of 2.79%, as the mortgage price war intensifies.
It comes hot on the heels of Coventry’s 10-year fix at 2.39%, the lowest on record.
Kevin Mountford, banking expert at MoneySuperMarket, said: “The recent Brexit vote has thrown up some big decisions for the country’s households, none bigger than what’s going to happen to their mortgage.
“This makes Coventry’s move an interesting one and highlights that in the political and economic uncertainty post-Brexit, customers need to think about what’s right for them right now.
“The new HSBC ten-year fixed is also worth considering – it has a slightly higher rate at 2.79% but comes with no fees and a higher loan-to-value of 70%. This highlights the importance of looking at the overall cost of comparison on a mortgage, rather than just a stand-out rate.”
HSBC recently launched a two-year fixed rate mortgage that has an interest rate of 0.99%, the lowest since records began.
The mortgage price war has escalated in recent months following hints by Bank of England Governor Mark Carney earlier this year that the Bank rate could be cut in the event of a Brexit vote.
Speaking to business leaders last week, Carney said that a declining economic outlook could lead to the bank pumping more money into the economy through quantitative easing.
Carney suggested that a cut in interest rates was possible by the Bank this summer to deal with the economic uncertainty following the vote to leave the EU.
Some analysts believe that interest rates could drop from their historic low of 0.50% to 0.25% as early as next week.
HSBC also unveiled new research which found that millennials are most likely to seek mortgage stability, with almost eight in 10 willing to consider fixing for 10 years.
Since the financial crisis in 2008 mortgage rates have steadily fallen.
Chris Pilling, chief executive of Yorkshire Building Society, said earlier this year that mortgage rates could drop below 1% for the first time.
With lenders slashing rates, experts believe there has never been a better time to get a mortgage.
Nationwide has cut its fixed rate and tracker mortgages by up to 0.25%, while Halifax has reduced its rates on its first-time buyer mortgage range by 0.30%.
Newcastle Intermediaries has also launched a new two-year fixed rate mortgage for re-mortgaging customers at an interest rate of 1.99%.
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