Chelsea witnesses five-year fixed-rate mortgage demand

A high street lender has witnessed a surge in applications for its five-year fixed-rate mortgages since the start of the year.

Chelsea Building Society, now part of Yorkshire Building Society, claims that many borrowers are opting for the medium-term security of fixed mortgage payments, amid the uncertainty surrounding the economy.

As a result, Chelsea has launched a new five-year fixed rate mortgage at 3.99 per cent for consumers with a 25 per cent deposit.

The product, which is fixed until July 31st 2015, comes with free valuation and a £495 arrangement fee.

Andrew Paddock, mortgage product manager at Chelsea, said: "More and more customers are realising that while mortgage rates have been at historic lows for some time, sooner or later they may start to rise.

"We think that the opportunity to fix mortgage payments now at 3.99 per cent for the next five years is attractive."

Paragon Mortgages recently reported that two-year deals are the most popular fixed-rate mortgages with consumers at present.

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2010-06-18 13:52:03 © Moneyextra.com