Attractive 30-year mortgages are "impossible"

In spite of calls for the introduction of long-term fixed mortgage rates, an expert has claimed it would be impossible to create.

Ray Boulger, senior technical manager at John Charcol, said that creating a 30-year fixed rate mortgage is not a new concept, explaining that the terms on offer to buyers often seemed unattractive, leading to low demand and uptake.

He added that despite calls for longer-term mortgages, the suggestion is not straightforward.

The comments follow a speech from Grant Shapps at the Building Societies Association's annual mortgage seminar, where the housing minister called on lenders to consider offering longer fixed mortgages in order to encourage greater stability in the housing market.

"If you can get the pricing and the rest of the terms right then there is some demand for these products, but the challenge in the current market is to get that right. I think that frankly it will be impossible to offer a long-term fixed-rate mortgage on terms which many borrowers would find acceptable," Mr Boulger said.

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2011-10-24 13:42:16 © Moneyextra.com