In a move aimed at providing relief to homeowners and potential buyers amid high mortgage rates, Skipton Building Society has announced a series of mortgage rate changes and product extensions set to take effect on the 12th of September 2023. The building society, known for its customer-centric approach, plans to reduce fixed rates across selected mortgage products and introduce a brand-new three-year fixed-rate home loan option.
Mortgage Rate Changes and Extensions
The rate cuts will apply to a variety of borrowers, including residential, landlord, new build, and government scheme ranges. This decision comes at a crucial time for the housing market, with approximately 800,000 fixed-rate mortgage deals scheduled to expire in the latter half of 2023, followed by an additional 1.6 million deals due to mature in 2024, according to data from UK Finance. The past few years have seen an unprecedented surge in mortgage rates, with many two- and five-year deals that were originally offered at below 2% interest now hovering above 6%. The seemingly relentless increase in interest rates can be attributed to the Bank of England’s decision to raise the base rate on 14 separate occasions since December 2021. As of now, the central bank’s base rate stands at 5.25%, significantly impacting borrowing costs for homeowners across the country.
Skipton’s introduction of three-year fixed-rate mortgages aligns with a recent trend among mortgage lenders who have launched similar products in response to the volatile interest rate environment. These three-year deals offer borrowers a slightly longer-term option rather than forcing borrowers to choose between a long 5-year fix or a shorter 2-year fix, providing a buffer against further rate hikes while allowing them to take advantage of potentially lower rates in the future when they consider refinancing or switching to a new deal.
Extended Product End Dates
Skipton has also shown its commitment to its customers by extending the end dates on selected mortgage products. For residential and buy-to-let ranges, end dates will now extend up to December 2025, 2026, and 2028, providing borrowers with added flexibility and peace of mind. For those engaged in new build and government scheme arrangements, end dates will be extended to March 2026 and 2029, respectively. While these changes potentially serve as a welcome relief for borrowers, it’s important to note that Skipton will also be withdrawing selected fixed residential rates. Therefore, potential buyers and those looking to remortgage should act swiftly to take advantage of the newly reduced rates and extended end dates before they are gone!
This strategic move by Skipton underscores the challenges and opportunities facing both the housing market and borrowers in the current volatile economic landscape. By offering competitive rates and longer fixed-term options, Skipton aims to help its customers navigate the uncertainties of the mortgage market while planning for a more stable financial future.
Speak To a Mortgage Advisor About Mortgage Rate Changes
If you want to know more about mortgage rate reductions and other changes released by mortgage lenders, then you need to enlist the help of a qualified and specialist mortgage broker such as ourselves at Oportfolio. Give us a call or drop us a message today to arrange a conversation with one of our senior mortgage and protection advisors. We are here to help.