Principality Building Society has brought in the three-year capped rate mortgage.
Aimed at first time buyers and existing borrowers who are looking to remortgage, the mortgage has a capped rate of 5.95 per cent for three years for loans of up to 75 per cent of valuation. Following the capped rate period the mortgage will revert to the company's standard variable rate, which is currently 7.49 per cent.
With income multiples of 3.5 times principal income plus second, this places the mortgage rather higher than the industry norm for this type of mortgage of three times principal income plus second.
According to Moneyfacts the cheapest mortgage on the market on November 8, 2000 is the capped rate mortgage from Yorkshire Building Society with a rate of 5.79 per cent for loans up to 75 per cent of valuation and with the same redemption fees.