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Mortgage Solutions - Brokers are mixed on long-term fixed rate following Perenna launch   Green Tick

  (07/09/2023) Perenna Bank, Mortgage Solutions

The popularity of long-term fixed rates will be dependent on pricing, early repayment charges and attitudes to affordability changes in light of Perenna securing its banking licence today, brokers have said. Perenna was launched in 2018 and looks to bring long-term fixed rates of 20 years or more to the UK mortgage market. It also has a different funding structure to most lenders as it uses covered bonds, which is a portfolio of loans issued by a bank then sold to a financial institution for resale. The lender secured its full banking licence today from the Prudential Regulation Authority and Financial Conduct Authority, noting that it would offer mortgages to those on its 5,000-strong waitlist first and then open to the public later this year. Long-term fixed rates are popular in the US and Europe but have not had the same read-across to the UK as short-term and variable rates are more common. Early repayment charges (ERC) and pricing have also been dissuasive factors to take-up. Mortgage Experts give their opinions: https://www.mortgagesolutions.co.uk/news/2023/09/07/brokers-mixed-on-long-term-fixed-rate-popularity-following-perenna-launch/

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