Woolwich Launches Fix and Track Mortgage

by Gill Montia

Story link: Woolwich Launches Fix and Track Mortgage

The Woolwich has launched a new mortgage aimed at helping buy-to-let investors whose fixed-rate mortgages are coming to an end. The group’s fix and track mortgage offers a 5.99% fixed-rate for a period of a year. After 12 months the mortgage reverts to a tracker rate, which is 0.69% over the base rate; this applies for the remainder of the mortgage term. A loan-to-value rate of up to 85% is allowed and the loan can be transferred to another property.

The mortgage, which carries an arrangement fee of £495, requires early repayment charges of six months interest at the buy-to-let standard variable rate, or fixed rate, whichever is higher, until the beginning of October 2010.

According to the Woolwich, swap rates are at their highest levels since 2000. Borrowers are being prompted to remortgage because of the likelihood of base rate increases over the summer and autumn. One or two rate rises of a quarter point are expected by the end of the year. The new product is aimed at giving buy-to-let investors the stability they need whilst interest rate rises remain probable. At the same, the lifetime tracker element will allow them to take advantage of any decrease in interest rates in the future.