The Post Office hopes to become much more competitive in the mortgage marketplace by dropping their mortgage rates down to 1.7% which is the lowest rate that the bank has ever offered on a fixed rate mortgage product.
The largest reductions offered by the Post Office will be on their two year fixed mortgages. The new products will start at 3.19% and 3.49% and neither come with an attached arrangement fee making the figures look a bit more tempting to the savvy mortgage shopper.
These offers will also be attractive to a second time buyer that is simply looking to re-mortgage their loan as they can take advantage of a two year fixed rate of 1.7% with the attached fee of £1,995.
Two year products are not all that the Post Office has to offer however, as they are also offering two five year fixed mortgage products as well. Both of the products come with a £995 attached arrangement fee and are flexible depending on the LTV. For a 75% LTV buyers can get a 2.85% fixed rate for five years whereas those that need the less demanding 85% LTV can take advantage of the 3.69% fixed rate.
The best product is clearly the 1.7% offer although the arrangement fee will likely put off some people that are not ready to put in that investment. However in the long run, this deal will end up paying off much more than any other rate available from the Post Office.
For those that do not want to pay the fee the 3.49% fixed rate product is also going to be a good choice allowing the Post Office to take a firm grip on the mortgage market. According to head of Post Office mortgages, John Wilcox, the new mortgage rates are some of the best that the lending agent has ever offered and they hope to attract all types of homebuyers.