Money News
New research from Abbey Mortgages has found that almost four times as many homeowners would opt for a fixed rate mortgage as a tracker if they had to renew their mortgage tomorrow. The monthly Abbey Remortgage Tracker found that 10.3 million people would fix and just 2.8 million would opt for a tracker mortgage this month.
2.4 million people (7% of homeowners) would opt to fix for 10 years and 1.8 million (6%) would fix for a massive 15 years if they were remortgaging tomorrow. The 2-year fix remains the most popular mortgage, however, with 8% - or 2.7 million people - saying they'd choose this option.
Demand for long-term fixes continues to increase - the research showing that both 10 and 15-year fixes are now almost as popular as 2-year fixes (at 7 and 6% compared to 8% respectively.) But it seems the majority of borrowers would be in a quandary over which type of deal to opt for - 58% claiming they would be unsure of which deal to choose. 4% of mortgagers - over 1.3 million people - would choose their lender's standard variable rate.
Nici Audhlam-Gardiner, of Abbey Mortgages said: "The research suggests that continued talk of economic gloom has had two effects on borrowers: they are either determined to take the more stable option or are confused about the best mortgage option to take."
Audhlam-Gardiner adds that there is continued interest in longer term fixed rate mortgages, reflecting customer confusion in what will happen in the markets short term; and also some fatigue with the two year remortgage effort and costs.
"Borrowers need to be sure however that the deal they take out is right for them and that they understand the different types of mortgages available before signing up to anything," he says.
11 February 2008 © Moneyextra.com
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