Lenders 'abandoning long-term fixed-rate mortgages'

Date:Thursday 23rd July 2009
Author: Susanna Kavka

Lenders in the UK are offering fewer long-term fixed-rate mortgages, it has been claimed.

According to figures produced by Moneyfacts.co.uk, in January last year, nine home loan providers were offering 25-year deals.

By January this year, this number had fallen to three and, now, no such deals are available to consumers.

Moneyfacts.co.uk suggests that lenders moved to offer long-term deals following calls from Gordon Brown, who said that they would help reduce the volatility in the housing market.

Since this time, however, the market for such home loans has "disappeared".

Spokesperson for the organisation Darren Cook said: "Providers and brokers alike prefer the frequent turnover of shorter-term deals as they can ensure borrowers are on an appropriate deal for the market conditions."

Recently, the Council of Mortgage Lenders stated that while the UK may be past the worst period for the housing market and the wider economy, mortgage lending remains weak.