Type: Fixed-rate mortgage
Fixed term: Three years
Fixed rate: 6.29%
Minimum loan: £25,001
Maximum loan: Up to 85% of valuation subject to a maximum of £500,000, up to 75% of valuation subject to a maximum of £750,000, up to 65% of valuation subject to a maximum of £1m
Income multiples: Up to four times principal income plus second or 3.25 times joint
Conditions: One free standard valuation
Flexible features: Overpayments, underpayments and payment holidays, lump sum withdrawals, interest calculated daily
Arrangement fee: £695
Redemption fee: 5% of the amount repaid in the first three years
Introducer’s fee: Refer to lender
Tel: Tel: 0845 940 1400
UCB’s new prime self-cert range comprises fixed and tracker rates up to a maximum of 85 per cent loan to value. This deal offers a three-year fixed rate of 6.29 per cent.
In London & Country mortgage specialist James Cotton’s view, the arrangement fee is a very reasonable £695 and a free standard valuation is offered. “Early redemption charges apply during the fixed-rate period, but there are some flexible features. Overpayments of up to £500 per month are allowed without penalty and there is the ability to borrow back, make underpayments and take payment holidays subject to sufficient overpayments,” he says.
Looking at the weaker features of the product Cotton says: “Self-employed applicants are required to have been in their current business for a minimum of 12 months. Employed applicants must have been in their current job for at least six months. This requirement, although still typical for the self-cert market, can be quite restrictive as the people who often most need self-cert are those who have recently become self-employed.”
He suggests Kensington’s three-year fix at 6.24 per cent up to 85 per cent LTV, with a fee of £899, as the main competitor for this deal. “ It has similar flexible features, but one important difference is that it has no minimum employment or trading period,” says Cotton.
He also mentions that lenders such as Bank of Scotland, The Mortgage Works and TMB are currently offering lower self-cert fixed rates, although the fees are higher so loan size will be a decisive factor.
Suitability to market: Average
Competitiveness of rate: Good
Adviser remuneration: Good