Habito launches 40-year fixed rate mortgage

Online mortgage broker and lender Habito is launching a long-term fixed rate mortgage with a maximum deal period of 40 years.

The product, called ‘Habito One’, will be available via Habito on March 15. First-time buyers, homemovers and remortgagers in England and Wales will be offered a fixed rate period between 10 and 40 years.

The mortgage will have no early repayment charges or exit fees, enabling customers to safeguard against future interest rate rises, while maintaining “flexibility and freedom” over their home finances.

Pricing table: Habito One

Mortgage term (years) 10–15 16–20 21–25 26–30 31–35 36-40*
Product fee £1,995 £1,995 £1,995 £1,995 £1,995 £1,995
ERC None None None None None None
60% LTV 2.99% 3.29% 3.49% 3.59% 3.84% 4.20%
75% LTV 3.29% 3.39% 3.59% 3.69% 3.94% 4.30%
80% LTV 3.59% 3.69% 3.84% 3.94% 4.19% 4.55%
85% LTV 3.89% 3.99% 4.14% 4.24% 4.49% 4.85%
90% LTV 4.39% 4.49% 4.64% 4.74% 4.99% 5.35%

*Indicative rate correct as of 8 March 2021.

According to Daniel Hegarty, Founder and Chief Executive Officer of Habito, the Habito One mortgage will remove the need to remortgage every two to five years, which is “costly, time-consuming and repetitive”.

Rates for the Habito One product will start at 2.99% at LTVs ranging from 60 to 90%. The lender plans to introduce 95% LTV products from the summer 2021.

Product fees are applicable when the borrower takes out the mortgage or increases their borrowing.

According to Habito, an October survey of 1,480 homeowners demonstrated that 30% of customers would be interested in switching to a long-term fixed rate mortgage for flexibility, certainty and protection against interest rate rises.

The Habito One product will be available exclusively via Habito but could become more widely available in future like its buy-to-let products, according to Martijn van der Heijden, Chief Financial Officer at Habito.

Image: Mike / Pexels

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About Dominique Fancelli

Dominique Fancelli writes about homeownership and investment opportunities in the property sector.

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