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Specialist lender Kensington | Launches 40-Year Fixed Mortgages

Specialist lender Kensington

Specialist lender Kensington


Specialist lender Kensington has launched a rare 40-year fixed-rate mortgage. This unique long-term financing option benefits borrowers in the evolving housing market. The extended loan term offers greater flexibility for homeowners.

Spreading repayments over four decades can result in lower monthly payments. This is advantageous compared to traditional 15 or 30-year mortgages. Moreover, it can attract those wanting to lock in a stable interest rate. This mortgage provides peace of mind and predictability.

Additionally, the 40-year mortgage may appeal to first-time homebuyers and is beneficial for those purchasing in high-cost housing markets. Affordability is a significant concern in these areas, and this innovative mortgage product effectively addresses that need.

What do we know?

Recent research by specialist lender Kensington Mortgages reveals that 83% of homeowners and renters prefer long-term fixed-rate mortgages for repayment certainty.

Kensington has partnered with specialist pensions insurer Rothesay to introduce this innovative mortgage product. Rothesay will supply the necessary funding.

Interest rates depend on the chosen fixed term and the borrowed amount. These rates apply to new home purchases with a loan-to-value (LTV) ratio of up to 95% or remortgages with an LTV of up to 85%. Rates start at 2.83% for a 15-year term at a 60% LTV.

Competitive rates of 2.85% and 2.90% are offered for a 25—or 30-year fixed term at 60% LTV. Extended terms with a 95% LTV feature rate of 3.71% for 25 years and 3.77% for 30 years.

Kensington’s ‘Flexi Fixed for Term’ focuses on affordability, which is determined by the fixed interest rate rather than a higher stress rate. This can help clients secure larger mortgage amounts.

Moreover, this mortgage product offers exceptional flexibility. It is portable, allowing you to transfer it to a new property while maintaining the same interest rate and fixed monthly payments.

Additional benefits include complimentary legal services and no product fees. Kensington accepts eligible gifted deposits and imposes no early repayment charges for moving, selling critical illness, or death.

Furthermore, you can make overpayments up to 10% per calendar year based on the original balance. If additional funds are needed, you can apply for a further advance after 12 months, subject to affordability.

Upon completion, brokers, including mortgage clubs and networks, will receive a 0.75% proc fee. This offering aims to provide homeowners and renters with a reliable, flexible mortgage solution tailored to their needs.

Let’s hear from the experts.

Mark Arnold
Mark Arnold, CEO of Kensington Mortgages

Mark Arnold, CEO of Kensington Mortgages, commented: “We have grown used to ultra-low interest rates over the last 12 years. Many homeowners have never known anything different. But nothing lasts forever. It seems likely we will see a series of interest rate hikes. We may slowly approach a historical average.

A fixed-for-term mortgage, already popular in parts of Europe, will become more attractive in a rising rate environment.

“No two people or their circumstances are the same. Whether you’re a first-time buyer or homeowner wanting an affordability boost, a self-employed worker worried about remortgaging, or someone wanting greater certainty on monthly repayments – our new Flexi Fixed for Term can help.

It is that simple, with one fixed monthly payment until the mortgage ends, extra borrowing power, and added flexibility for any life events.

“A long-term fixed-rate mortgage may not always be suitable for everyone, so we’ve offered this product with as much flexibility as possible. For others, it could be the only way to afford a property.

Our latest research found that one-quarter of renters who attempted to purchase a home in the last five years were unsuccessful. Of these, more than a fifth did not pass affordability checks, and a quarter could not borrow as much as they needed. These products could be a serious alternative for getting people onto the property ladder who would otherwise be excluded.”

Prateek Sharma
Prateek Sharma, Rothesay’s chief investment officer

Prateek Sharma, chief investment officer at Rothesay, stated, “As the UK’s largest specialist pensions insurer, Rothesay is well-positioned to support long-term loans. These loans play an important role in the market. We continually seek innovative ways to invest in long-term, secured, high-quality assets. We believe these mortgages provide the certainty many borrowers seek.

Through our partnership with Kensington, we support the government’s ambition to offer new mortgage products. These are purposefully designed to increase homeownership while providing long-term security.”

 John Glen
John Glen, Economic Secretary to the Treasury

Economic Secretary to the Treasury, John Glen, commented, “I am delighted to see new products like this. I am always pleased to see innovation in the UK mortgage market. Greater product choice creates more competition and options for consumers. This is especially beneficial for those who value certainty in their repayments over a longer period.”

What does that mean to Connect? 

Connect, a forward-thinking mortgage network aligns seamlessly with the innovative mortgage product specialist lender Kensington Mortgages introduced. Committed to providing brokers and their clients with cutting-edge solutions, Connect recognises the value of options like the ‘Flexi Fixed for Term’ mortgage. This partnership allows Connect brokers to offer their customers a dependable, flexible mortgage choice that caters to individual needs.

The competitive rates, portability, and emphasis on affordability perfectly complement Connect’s mission to empower brokers to deliver the best financial solutions to their clients. Connect ensures that brokers can take full advantage of this new offering and continue to provide exceptional service while benefiting from a 0.75% proc fee upon completion.

Together, Connect and specialist lender Kensington Mortgages are poised to meet the evolving demands of the mortgage market, offering a product that aligns with the ever-changing needs of homeowners and renters.