Mortgages that get cheaper over time

TangentMan

First off i should state that i know what i am like. So, for example, if i go for a 5 year fixed, i know that in 5 years time i will start umming and ahing about what to do as the end of the fixed rate approaches.

So, to allow for my laziness i was wondering if there were any lenders offering products that actually get cheaper over time ? I can't find any.

Would they be a good bet?

HelpWhereIcan

The quick answer is that there are lenders that offer a 'loyalty discount' after you have been with them for a certain number of years However, in most cases, the rate payable is not great even including the loyalty discount.

You would probably be better off looking at a long term low rate, for example the Abbey have a tracker deal at 4.99 for life of the mortgage. (This is not a reccomendation of this deal as suitable for you, just an indication of what is out there).

If you need a fixed rate to begin with, look for a deal that has a low revert to rate such as the A&L that has a few fixed rate deals where the long term rate is a tracker,currently at 5.49%. (Again, this is not a reccomendation of this lender as suitable for you, just an indication of what is out there).

In both these scenarios, you are likely to end up with a deal that is competitive for the long term and, although you would still be better off reviewing it regularly, you would be better off than with a deal with a 6.5% long term rate if you were never to remortgage.

Hope this helps

Ian_W

TangentMan wrote: So, to allow for my laziness i was wondering if there were any lenders offering products that actually get cheaper over time ?

No and if you think about it, who would they appeal to? Hardly catchie an ad that says, " Here's our great new fixed [tracker] at 1% above base rate, guaranteed in 5yrs to be only 0.5% above and in 10ys 0.25 etc ..." compared to the opposition saying, " Fill yer booits with our 2yr 4.29% fixed NOW..." If you get my drift.

From the co's point of view they want customers NOW, from the borrowers they want savings NOW. If you're a bit lazy on remort's as HWIC says get a longer deal, but IMO no more than 5 yrs as many things can change. Otherwise grin, bare it and make the effort as it does make sense financially.

TangentMan

Cheers chaps. I was just intrigued, because whilst it might be tricky to describe to us i am sure there are a lot of people who don't review their mortgages in the most timely manner and there is always that fear of the payment shock - but i guess that should be stimulant enough.