The amount of borrowers opting for fixed rate mortgages has hit record levels, with the products making up 70% of cases submitted by mortgage brokers in the second quarter of the year.

According to the latest Paragon Financial Advisor Confidence Tracker research, this is the highest level since the survey was launched in 1996. Fixed rate mortgages accounted for 55% in the first quarter of 2009 and 41% in the final quarter of 2008.

The proportion of Bank of England base rate tracker mortgages fell over the same period, from 41% to 26% of cases introduced between the first and second quarters of the year.

Paragon said this trend was as a result of lenders withdrawing or re-pricing tracker mortgages as the Bank of England slashed interest rates between December 2008 and March 2009.

Of the fixed rate mortgages, two-year terms remained the most popular, at 40%, three-year fixes 32%, five-year 24%, 10-year 2.5%. and one-year 1.5%.

John Heron, Paragon Mortgages managing director, said: “With borrowers unsure about the next move for interest rates, they appear to have been opting for the security of fixed rate deals. It is likely that the next move for base rates will be upwards, but it is unclear when that will be.

This entry was posted on Friday, August 14th, 2009 at 9:12 am and is filed under Mortgages. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.