First ever tracker mortgage with interest rate below one per cent
CHELSEA Building Society yesterday unveiled the first ever tracker mortgage with an interest rate below one per cent.
Housebuyers who want to borrow under the scheme need to meet stringent restrictions, including having a 35 per cent deposit and paying £1,545 in fees.
But if they can do, applicants are rewarded with an interest rate of 0.98 per cent – 0.48 per cent above the Bank of England’s base rate.
The next best tracker mortgage deal comes from the Post Office, which is offering a rate of 1.08 per cent for borrowers with a 40 per cent deposit (and with a fee of £1,995).
The Yorkshire Building Society – which owns Chelsea Building Society – also began offering a two-year fixed rate of 1.07 per cent last week.
The news comes as signs start to suggest competition among mortgage lenders is beginning to heat up.
Figures released this week showed the biggest spike in mortgage lending since April 2009, with the number of mortgages given approval rising to 68,076 in April, from 61,945 in March.
At the same time, the number of people buying homes without needing to borrow has increased.
According to figures published by Nationwide on Wednesday, almost four in 10 people paid cash for properties during the first quarter of this year – suggesting the scramble for buy to let properties continues apace.