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Habito launches 40-year fixed rate mortgage

Christina Hoghton
Written By:
Christina Hoghton
Posted:
Updated:
10/03/2021

Borrowers can now secure their rate for the entire term of their mortgage, but cheaper deals are available

Habito is launching a 40-year fixed rate mortgage, which it says is the longest ever product of its kind.

The mortgage is available at up to 90 per cent of the property’s value, and has no early repayment charges or exit fees.

However, all versions have a £1,995 product fee which must be paid again if additional borrowing takes place.

The mortgage is also fully portable with only valuation and legal fees required if borrowers decide to move home.

Rates start at 2.99 per cent and are fixed for the full contractual term of the mortgage.

Who can get the mortgage?

The Habito One mortgage will be available from 60 per cent loan to value up to 90 per cent with a range of terms from 10 years to 40 years from launch.

A loan to income (LTI) multiple of 4.5 times will apply as standard, but it will be extended to five times income for those with gross income over £50,000.

New build properties are eligible, as are flats, but with a lower maximum LTV of 85 per cent for flats, and property values of £50,000 to £10m will be considered with a maximum loan amount of £1m.

The mortgage is available from 15 March for first-time buyers, home-movers and remortgagors in England and Wales but only through Habito.

“Monthly repayments will stay the same throughout the lifetime of the mortgage guaranteeing peace of mind and full control over monthly budgeting forever, removing the need for the continual and often costly cycle of remortgaging every two to five years,” Habito said.

Is it competitive?

By comparison, the lowest rate 10-year fixes currently available include the Barclays version at 1.99 per cent with a £999 fee while Halifax has a zero-fee option at 2.15 per cent, but both these have early repayment charges (ERCs) throughout the whole term.