Scottish Widows launches new long-term fixed-rate product

Scottish Widows has launched a new ten-year fixed-term product, looking to target homeowners who are coming to the end of their current mortgage deals this year.

The new offering provides an interest rate of 5.59 per cent for all loans under 75 per cent of the loan-to-value, while those above that level will face a rate of 5.89 per cent on their monthly repayments.

A product fee of £499 is payable, though this can be added to the cost of the loan, while it is possible to pay back up to ten per cent of the loan balance ahead of schedule every year without incurring an early repayment charge.

Announcing the new deal, Richard Clark, head of product development and marketing at the lender, claimed that it would offer stability and reassurance to homeowners concerned about the potential for higher monthly repayments on any new mortgage.

"Many people are coming to the end of cheaper short-term fixed rate deals, and affordability can become an issue when looking for a new deal," he said. "Although interest rates are expected to stabilise this year, demand for fixed rate deals is likely to remain strong as borrowers look to protect themselves against any future rate increases," he added.

"This new rate will help homeowners who want to lock in long-term value and avoid payment shock by having the security of knowing that their monthly payments are going to stay the same for a defined period."

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