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Mortgage Next goes for fixed fee saver

Specialist mortgage broker Mortgage Next has introduced the buy to let five year fixed fee saver mortgage.

The mortgage has a fixed rate of 6.23 per cent for loans of up to 75 per cent of valuation for the first five years of the mortgage, after which it will convert to an interest rate of 1.75 per cent above the Bank of England base rate.

The redemption penalties for the mortgage are 7 per cent of the advance for the first year, 6 per cent of the advance for years two and three and then 5 per cent of the advance for two years after that, as well as an additional £100 administration fee.

After a long period of volatility on the stockmarkets, many investors are choosing to invest in property instead as a safer bet, and this has had a significant impact on the buy to let market. According to the Council of Mortgage Lenders the number of new buy to let mortgages increased from 19,300 on June 31, 2000, to 25,700 on December 31, 2000.

Looking at the rest of the market, the Mortgage next product is not the most competitive five-year fixed rate buy to let mortgage. According to Moneyfacts this is the fixed buy to let mortgage from Bristol & West. This has a fixed rate of 5.99 per cent for loans of up to 75 per cent of valuation for the first five years of the mortgage. It also has redemption penalties of 7 per cent of the advance in the first year, 6 per cent in the next two years and 5 per cent for the two years after that.

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