Legal & General mortgage club has launched a reverse tracker loan through Accord Mortgages.
The reverse stepped tracker starts at bank rate plus 3.49 per cent in year one, dropping to bank rate plus 2.99 per cent in year two and bank rate plus 1.49 per cent in year three.
The company is also offering a two-year fixed rate. Both loans are available for purchase and remortgage.
Head of mortgage products Martyn Smith says: “A reverse stepped tracker is not a mortgage product that you will see every day but an unusual mortgage market calls for innovative solutions. It is a product that helps protect the borrower against future rate increases. We think it will be a very popular product and we will be managing the tranche carefully. We are really pleased to have worked with Accord to bring something so ground-breaking to market.”
Accord strategic development director Cate Hillis says: “The reverse stepped tracker cushions borrowers against future base rate rises and provides intermediaries with greater product choice when reviewing the best option for their client.”