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L&G makes a flexi fix

Legal & General has introduced a two-year fixed rate flexible mortgage that offers borrowers a cashback of £200.

The two-year flexi fix mortgage has an interest rate of 6.39 per cent until February 28, 2003 and allows borrowers to make overpayments, make underpayments, take payment holidays make lump sum withdrawals and interest is calculated on a daily basis.

It is possible to get cheaper interest rates on a two-year fixed rate flexible mortgage, but they tend to be limited to 80 per cent of valuation.

According to Moneyfacts on December 21,2000, Skipton Building Society is offering a flexible two-year fixed rate mortgage for loans up to 95 per cent of valuation with an interest rate of 6.20 per cent. This is a better rate than the Legal & General mortgage, but it does not allow borrowers to make lump sum withdrawals and it has an arrangement fee of £295 compared to £150 for the Legal & General mortgage. However, some borrowers may prefer to do without the lump sum withdrawal facility than pay a higher rate.

Skipton also has a two-year fixed rate flexible mortgage that has an interest rate of 5.95 per cent, but it has a maximum loan to valuation of 80 per cent.

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