View more on these topics

Principality offers discount with cashback

Principality Building Society has introduced a five-year discounted rate mortgage for loans of up to 95 per cent of valuation.

The discount option 5 mortgage has a 0.80 per cent discount until December 31, 2006, which gives a current payable rate of 5.15 per cent. There is no arrangement fee and a £250 cashback is given to borrowers. However, if they pay the mortgage off during the discount period, they must repay the cashback as an early redemption penalty.

According to Moneyfacts on October 1, 2001, NatWest Mortgage Services is offering a similar five-year discounted-rate mortgage at a less competitive rate of 5.29 per cent. This mortgage has a 1.20 discount which is reclaimed if borrowers pay off the mortgage within the first five years. This is a higher penalty than Principality&#39s.

One potential downside is that Principality adds 0.19 per cent to the payable rate if borrowers decide not to take the society&#39s buildings and contents insurance. This insurance protects fixtures and fittings as well as the frame of the house, but borrowers will not always get the best deal if they allow their lender to arrange it for them.

NatWest Mortgage Services allows borrowers to shop around for buildings and contents insurance without penalising them. However, some borrowers may see this as too much hassle and go for the lender&#39s insurance anyway.

Recommended

House prices surge in September

House prices in the UK rose by 2.8 per cent, the highest monthly increase for eight years in September, according to figures published by Nationwide.The Nationwide figures show that the average price of home in the UK has increased 14.6 per cent since September 2000 to £92,432.

Alliance unites to back advice

The ABI, Autif, AITC, Aifa and Apcims have formed an unprecedented alliance in a bid to ensure Ron Sandler recognises the value of financial advice in his review.In a joint letter, the five director generals – the ABI&#39s Mary Francis, Autif&#39s Richard Saunders, Apcims&#39 Angela Knight, the AITC&#39s Daniel Godfrey and Aifa&#39s Paul Smee – […]

Schroders calls for product comparison

Schroders has suggested that IFAs should be required to provide clients with a minimum number of comparable products when recommending investments. It supports a strong independent advice market but advocates a greater degree of regulation.

The lost resort

As the Liberal Democrats assembled for their annual love-in last week in Bournemouth, international events proved much more important than slating the Tories for once and delegates adopted an appropriately serious tone throughout the week.Security was noticeably heightened, with ladies in bright yellow shirts searching people&#39s bags.The scheduled events were thrown into disarray as an […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment