First-time buyers or borrowers with a 10% deposit are set to benefit the most from the current reductions in mortgage costs, figures from Mortgage Brain’s quarterly product data analysis have revealed.
Mortgage Brain’s data shows that the cost of a 2-year fixed mortgage with a 90% LTV is now 6% lower than it was this time last year.
With a current rate of 2.79% over two years the reduction in cost for this product could leave an extra £504 a year in the pockets of people with a £150,000 mortgage.
Similarly, a 90% LTV 2-year tracker at 2.54% has also seen a 6% reduction in cost over the past 12 months equating to an annual saving of £468.
The biggest saving, however, comes in the shape of a 5-year tracker with a 90% LTV, which, with a current rate of 2.55%, is now 13% cheaper than it was in July 2015 and equates to a potential £1,206 saving.
Mark Lofthouse, CEO of Mortgage Brain, said: “Despite the Bank of England confirming that the UK’s main interest rate will be held at 0.5% there is still a lot of uncertainty about rate movement and the cost of borrowing following Britain’s decision to leave the EU. A rush of rate cuts is still predicted and our month on month analysis validates this with the cost of mortgages falling slightly compared to last month.
“Our longer term analysis, however, clearly shows that homeowners – particularly first time buyers or those with low deposits – are in a very good position to benefit from the current reductions in the cost of mortgages.”