Co-op relaunches 25-year fixed-rate mortgage

At the beginning of next week, the Co-operative Bank will relaunch its 25-year fixed-rate mortgage.

The mortgage is intended for those who will settle for a fixed-rate of 5.95% in return for peace of mind.

The application fee is £599 and there are no early repayment charges after the first ten years.

Customers can make overpayments of up to 5% during the first 10 years and the maximum loan-to-value rate is 95%.

Long-term fixed-rate mortgages have traditionally been more popular across continental Europe than in the UK.

However, the Government has recently called for a greater provision of this kind of loan because it sees it as a means of stablising the housing market.

The offering from the Co-op is fully portable and will appeal to some because of its green credentials.

A donation to the charity Climate Care is made for every year of the mortgage.

The contribution is used to offset carbon dioxide emmissions and will typically allow Climate Care to offset one-fifth of an average home’s emissions each year, for the lifetime of the mortgage.

The Co-operative Bank has a number of ethical policies and also generally imposes lower changes than some rival lenders.

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