Habito One is the UK’s first ever mortgage where your interest rate and monthly repayments are guaranteed for the whole term – all the way to the end, until you finish paying it off. It also has no early repayment charge or exit fee, so you can leave whenever you want, or pay off your mortgage early without any penalties.
Mortgages as we know them today are built around lenders, rather than what customers actually need. Too many people on 2 or 5 year fixed rates are trapped in a cycle of remortgage admin, fees and stress, and a system that doesn’t give them control.
We asked ourselves what the ideal mortgage would look like – a mortgage designed for customers above everything else – and we created Habito One.
Here’s what you get with Habito One:
Your monthly payments will never change. You’ll know exactly what you pay every month, for the life of your mortgage – until your term ends and you’ve finished paying the whole thing off.
Your interest rate is locked in forever. Even if interest rates rise in the UK, your rate is safe.
Total flexibility to move or switch. There’s no early repayment charge and no exit fee, which means you can leave or switch deals whenever you want.
Pay off your mortgage early if you want to. Want to use a work bonus or some inheritance to pay off your mortgage sooner? Be our guest. There’s no early repayment charge with Habito One.
Take your Habito One mortgage with you if you move home. Here’s more about moving home with Habito One.
Never deal with the hassle of remortgaging again. Every time you remortgage, there’s admin to do and fees to pay. With Habito One, you go through the mortgage process once, and you’re done.
Habito One is open to first time buyers, home movers, and remortgagers in England and Wales.
If you have a 10% deposit, you’re more than welcome. The property price range is £50,000 to £10 million. We hope that covers most people!
We’re also hoping to bring out a deal for 5% deposits soon – watch this space.
Your rate will depend on two things: your loan to value (LTV) and the length of your mortgage term.
LTV is the size of your mortgage as a percent of the property value. So if you’re buying with a 10% deposit, that’s a 90% LTV. If you’ve paid off 40% of your mortgage on your current home, that’s a 60% LTV.
As you pay off more of your mortgage, you can switch down to a lower interest rate with Habito One. There might be a fee to do this.
Habito One rates can sometimes change, so for an up-to-date breakdown of our interest rates head over to our table of Habito One interest rates.
10 - 15
16 - 20 years
21 - 25
26 - 30 years
31 - 35
36 - 40 years
40% deposit, or 60% LTV
25% deposit, or 75% LTV
20% deposit, or 80% LTV
15% deposit, or 85% LTV
10% deposit, or 90% LTV
The longer you lock your mortgage rate, the longer your interest rate and monthly repayments stay the same. If you think interest rates will rise in the future, or you want the certainty of knowing exactly what you’ll be paying for the remainder of your mortgage, or you’re just fed up with having to remortgage every few years, those are all excellent reasons to consider fixing your rate for your full mortgage term.
If you get a fixed rate mortgage with, for example, a 2 year initial period, then you’re fixing your interest rate and monthly repayments for 2 years. When your fixed deal ends, your lender will slip you onto what’s called a “standard variable rate” (SVR). It’s usually much more expensive, which means your repayments could skyrocket, and it’s variable, which means it can go up and down.
To avoid going onto an SVR, most people switch to a new fixed deal. This is called remortgaging. It’s basically like getting a whole new mortgage – meaning more admin, fees and affordability checks. If you’re always choosing to fix for 2 or 5 years, that means you could end up having to remortgage up to 15 times over a 30-year mortgage. The cost and hassle can start adding up.
Two years tends to be the cheapest, short term, because your rate is only guaranteed for a short period of time. After that 2 years, you’ll need to go out and get a new deal, and hope that interest rates haven't gone up. Long fixed rates are usually a little more expensive short term. But the reward is your price is locked in for longer, no matter what happens to interest rates.
Habito One comes with no early repayment charges (ERCs). But what is an ERC, anyway?
An ERC is a fee you pay your lender if you:
Leave your mortgage before your fixed period ends, even if you’re switching to a deal with the same lender.
Pay more towards your mortgage than you agreed with your lender.
The amount you get charged is usually a percentage of the mortgage you have left to pay – usually 2–5% but it can go up to 10%! Let’s say you want to leave a fixed deal, with £250,000 left to pay on your mortgage and an ERC of 5%. You’d have to pay up to £12,500 to do it.
Habito One is the only long-term fixed mortgage in the UK that doesn’t have an ERC.
That means you can do two things, penalty-free:
Leave any time. With Habito One, you’re fixed – not stuck. If you want to leave or switch to another deal, we won’t charge you to do it. You can also move home without paying us an ERC to do it.
Pay off your mortgage early. If you want to use a work bonus or inheritance to pay off your mortgage sooner – either as a lump sum or by paying extra each month – you can.
It’s all about the interest. If you leave a fixed period deal early or pay more towards your mortgage than you agreed, your lender loses out on the interest payments they were expecting from you. So they charge you an ERC to recover what you would have paid in interest – and then some. It’s designed to put you off changing your mortgage in your fixed period, and earn your lender a tidy lump sum if you do.
We built Habito One to be a better, fairer mortgage that doesn’t punish you for changing your mind, changing your financial plans, or just living your life. So you won’t find any ERCs here.
Interest rates are the main thing that influence the price of your mortgage.It’s impossible to predict what will happen with interest rates over the next 30 years, during the whole time you have a mortgage. But that’s essentially what lenders are asking you to do when you choose how long to fix your mortgage for.
Interest rates can go up and down over the years. They used to be much higher. In 2007, the average fixed mortgage interest rate was 5.84%. At the start of the 1990s, the average was just under 14%. We can’t predict what will happen in the future, but it shows how much they can fluctuate over the length of a mortgage term.
Right now, rates are the lowest they’ve been in decades. So do you go for a 2 year fixed deal, and hope that by the time you have to switch again, interest rates will still be low? Or do you fix for longer, but trap yourself in an inflexible mortgage deal?
With Habito One you don’t have to choose between the safety of locking in your rate and the flexibility to move if you find something you like better.Your rate is protected for the life of your mortgage, even if rates rise in the UK. You’ll know exactly what you’re paying, and you’ll have full control over your mortgage forever. But still – and this is where Habito One is different from every other mortgage – with the freedom to leave or switch whenever you want.
Yes! Just the same as any other mortgage. You'll have two options for how to borrow more with a Habito One mortgage:
Remortgage to borrow more money (you can remortgage to a different lender, or you can remortgage to another Habito One deal)
Get what's called a “further advance” (like a second, separate and smaller loan from us)
Like with many lenders, you might have to pay a fee to do this. Your mortgage expert will help you understand what's right for you, make sure you can afford your new monthly payments, and tell you exactly how much more you might be able to borrow.
You sure can. When you’d like to move home with a Habito One mortgage, you’ll have a couple of options:
Take your Habito One mortgage with you
Also known as “porting”. You’ll have to pay a valuation fee on the new property, £350. That’s so we can check the new place is worth what we’re lending you on your mortgage. We’ll also do some other checks on the property to make sure we’re happy to lend you a mortgage for it. There’ll also be some legal costs to pay your conveyancer.
If you’re not borrowing any more money, you won’t have to pay us any other fees. If you’d like to borrow more, for example if your new home is more expensive, you’ll also pay a product fee of £1,995.
Pay off your whole mortgage when you sell
Because there’s no early repayment charge with Habito One, you can pay off your whole mortgage at once when you sell, and get a new mortgage with your new home (Habito One or otherwise).
If you choose to get Habito One again, you’ll need to pay valuation and product fees. Separately, you’ll also have to pay legal costs to your conveyancer.
With Habito One, you have options for both increasing and decreasing your mortgage term.
Increasing your term means your monthly payments will be smaller, though your interest rate might be higher. So while you’ll pay less each month, you’ll pay more over the life of the mortgage. That's because you’re spreading the total repayment of the mortgage over a longer period.
To increase your term, you’ll need to remortgage, which might come with a fee. Your Habito expert will talk you through the steps.
A shorter mortgage term means your monthly payments will go up, but your interest rate will drop. You’ll pay less interest over the life of your mortgage, and you’ll pay off your mortgage sooner.
Remortgaging is one way you can decrease your term. You can also make use of the unlimited overpayments you’re allowed with Habito One – paying more towards your mortgage each month, to pay it off sooner.
Yes! With Habito One, as you pay more off your mortgage, you have the option to switch down to a lower interest rate if they’re available (there might be a fee to do this). See what the different interest rate levels are here.
Habito One is all about flexibility. If at any time you find a mortgage deal that you prefer from another lender, you can leave Habito One. We won’t charge you any early repayment or exit fees.
We’re all too used to glitzy-looking deals that surprise us later down the line with hidden costs and sneaky terms.
Habito One has no hidden costs, and no nasty surprises. If you’re interested in getting this mortgage, we’ll explain exactly how it works and how it could help you, well before you sign up. We think it might be the perfect mortgage for a lot of people, but talk to us about it and you can judge that for yourself.
Our rates are a little higher than the cheapest 5 year fixed rate mortgages from other lenders – just like those 5 year fixes are more expensive than 2 year fixes. It’s because the longer the fix, the longer you get that certainty for. But unlike other fixed rates, with Habito One, you get flexibility too. You can leave your Habito One mortgage at any time, without having to pay an exit fee.
If interest rates rise, with Habito One you’ll be likely to save money over the life of your mortgage compared to switching between 2 or 5 year fixed rates. That’s because your monthly payments will never rise even if other mortgage interest rates do, and you won’t have to pay remortgaging costs every time you switch.
They’ll help you decide if Habito One is right for you, and answer any questions you have. If it’s the right choice, they’ll help you apply.Get a Habito One mortgage