Leeds & Holbeck Building Society is getting flexible with its latest capped-rate mortgage.
The mortgage is capped at 6.39 per cent for the first three years of the loan and has a discount of 1.4 per cent for the first six months. This gives it a current payable rate of 4.99 per cent.
Called the flexible mortgage, it is available to all borrowers and offers free legal fees for remortgages. It is fully flexible and offers the ability to make underpayments or overpayments, take payment holidays and lump sum withdrawals. Interest is calculated daily and there are no redemption fees.
One reason for the introduction of this mortgage is the rise in popularity of the flexible mortgage. According to a recent survey by MORI for the Council of Mortgage Lenders, in 2000 some16 per cent of all borrowers had a flexible mortgage, up from a figure of 12 per cent in 1999. However, only 5 per cent of these borrowers had used the payment holiday facility.
According to Moneyfacts the most competitive discount capped rate flexible mortgage is from Pink Home Loans. This has is capped at 5.19 per cent for the first three years and has a 1 per cent discount for the first year, giving it a payable rate of 4.19 per cent. However, although this is fully flexible it has a redemption penalty of 5 per cent of the advance for three years. The next most competitive mortgage without redemption penalties is from Intelligent Finance. This has cap of 5.25 per cent and a discount of 1.76 per cent for the first six months, giving it a payable rate of 4.24 per cent.