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Yorkshire BS offers flash two-year fix mortgage at 0.99%

Yorkshire Building Society is offering a 0.99 per cent two-year fixed-rate mortgage up to 80 per cent loan-to-value – a new record low rate. 

The catch is, it’s only available through mortgage brokers as the deal is exclusive to Accord Mortgages, Yorkshire BS’s intermediary lending arm. 

The deal is the lowest-ever mortgage rate for those with a 20 per cent deposit or equity to put in and will be on offer from tomorrow, Tuesday 19 September. 

The best buy deal comes with a whopping £1,495 product fee but free standard valuation fees

Watch out though, while it comes with free standard valuation fees it also comes with a whopping £1,495 product fee, which can radically increase the cost of the deal.

On a £150,000 mortgage taken over a 25-year term, monthly repayments on the deal would be £565, while the total cost including the fee over two years would be £15,046. 

David Robinson, of Yorkshire BS, said: ‘It’s important to be aware that this deal is only available via a broker and will be on offer for a limited time. 

‘So anyone interested in snapping up this great rate should get in touch with their broker fast.’

The next cheapest rate available for those with a 20 per cent deposit or equity is from Platform, part of the Co-operative Bank, at 1.23 per cent for a two-year fix with a £995 fee. 

On the same mortgage as above, this deal would put monthly repayments £16 higher at £581, while the total cost including the fee over the two-year period would be £14,941.

This means you’re paying £105 more for the advantage of lower monthly payments on the Yorkshire deal.

Andrew Montlake, of mortgage broker Coreco, said: ‘This really is an extraordinary rate, especially given the recent comments from the Bank of England on the fact that rate rises may be imminent.

‘This shows the competitiveness of the mortgage market at present and it is great to see a good lender such as Accord being proactive like this.’

The very cheapest mortgage rates have been hovering just below 1 per cent for a while, but until now, borrowers have had to have between 40 and 50 per cent deposits or equity to qualify for them. 

mortgage rates

‘The fact that this is available up to 80 per cent LTV is an added bonus and will give borrowers who often miss out on the very cheapest rates available a chance to enjoy the benefits,’ added Montlake.

‘However, it should always be remembered that rate is not everything and borrowers should obtain proper advice before jumping into a deal on price alone.’

To work out how much you’re paying including the product fee, use This is Money’s true cost mortgage calculator below. 

True cost mortgage calculator

This mortgage payment calculator will allow you to see the effect of sneaky arrangement fees on your repayments. Use the second part of the calculator to compare deals.