February Mortgage Update: Help for first time buyers?

Overall mortgage product numbers reduced a little in January, although we continue to see an increase in the number of mortgage products both at 90% and even 95% loan to value. This will enable more potential purchasers and in particular first time buyers to enter the housing market.

Interest rates

James Henderson, Commercial Director at Police Mutual comments on the Bank of England's latest decision to hold interest rates at the record low of 0.5%: "The Bank of England's Monetary Policy Committee again decided to hold interest rates at the record low of 0.5% for the 35th consecutive month and has announced that it is to increase its Quantitative Easing (QE) programme of putting more money into our economy to increase spending as it bids to keep the UK out of recession."

Average mortgage rates

February has seen a small increase in the average cost of 2, 3 and 5 year fixed rates and also in 2 year trackers, although all three categories of fixed rates remain below the same period in 2011. Average initial rates for fixed deals are currently 4.36% (2yr), 4.63% (3yr), 4.64% (5yr) and 3.54% for 2 year trackers.

"The UK is directly affected by events in the eurozone and with this latest round of QE and the base rate again held at 0.5%, this could end up providing a boost to mortgage borrowers."

To find out how the latest base rate decision affects you or if you are a first time buyer looking to enter the housing market call our Mortgage Advice Team on 0800 652 9103.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Our mortgage service is free for existing customers of the Police Mutual Group. The fee payable for non-customers can be up to 1% of the loan value, however, at present we charge a fixed fee of £300 and this will be waived if you take out any Police Mutual Group product during the process.


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