Skipton Building Society has launched a 10-year fixed rate mortgage at 5.85 per cent.
The deal, which comes with no fees, has a maximum loan to value of 85 per cent and allows overpayments of up to 10 per cent per year of the outstanding balance.
Skipton’s head of products, Kris Brewster, said: “Base rate has been at an historic low of 0.5 per cent for an unprecedented 28 months now and many borrowers have therefore become used to lower-than-ever mortgage payments. These low interest rates are unlikely to be sustainable in the long term, though, despite the current turmoil in the market.
“We believe that base rate is unlikely to rise until at least next year – and any increases after that will be incremental and slow. This means shorter term fixed and tracker deals might be the most cost effective for some types of borrowers at the moment.
“However, we think longer term fixes like this could offer an important alternative for those who are expecting to remain in their home over the longer term, who prefer to have payment certainty over a fixed term and value long term financial planning.
“10-year swap rates are close to their lowest levels ever, enabling us to offer a rate of 5.85 per cent , which is a very cost effective proposition over a decade term for those customers suited to this kind of product.”
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