USA 30 year fixed rate mortgages

domcastro

I was watching the CBS news last night and they were saying that mortgage rates were at an all time low. 30 year fixed rates for 3.89% - sounds good but I wonder how they deal with Eaerly repayments etc. It's strange in some countries you can get 30 year mortgages or 10 year tenancies - are we tight in the UK?

dunstonh

The market is largely dictated by consumer demand. There have been a number of long term fixed rates issued over the years but the consumer hasnt bought them in any volume that encourages them to be offered by mainstream lenders.

Thrugelmir

The US is very different in many ways. Not least that its markets are very insular. As with QE in the UK. The US has pumped billions of dollars of liquidity into the economy. All of which is driving interest rates down.

_Andy_

I think Nationwide had a 25 year fixed at one point (this was a few years ago) but no-one was interested in it. Consumers in the UK just (for whatever reason) want 2/3/5 year fixes

somethingcorporate

I'd bite their hand off for a 30-year fix at 3.89%, regardless of the ERC situation. You could almost certainly beat this savings rate over the long term even in cash / isa savings.

I wish someone would offer a rate like that in the UK, the rates have never been that competitive for such a long term fix.

Edit: http://www.guardian.co.uk/money/blog/2011/oct/20/30-year-fixed-rate-mortgage-shapps

Thrugelmir

somethingcorporate wrote: »

I'd bite their hand off for a 30-year fix at 3.89%, regardless of the ERC situation. You could almost certainly beat this savings rate over the long term even in cash / isa savings.

I wish someone would offer a rate like that in the UK, the rates have never been that competitive for such a long term fix.

Edit: http://www.guardian.co.uk/money/blog/2011/oct/20/30-year-fixed-rate-mortgage-shapps

Japanese mortgage rates have been around 3.5% for a very long time. They still haven't resolved the issues of their "credit" boom either.

VT82

It's to do with Fannie Mae and Freddie Mac underwriting them in the US.

Discussed here: https://forums.moneysavingexpert.com/discussion/comment/48625531#Comment_48625531

opinions4u

Halifax quite often had 25 year mortgages on offer.

My branches never sold one.

michaels

I believe that US mortgages don't have tie-ins/erps - makes a long term fix a lot more attractive but also make sit harder to steer the economy with base rate changes as they don't impact on mortgages.