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Private Label fills gap

Private Label is filling a gap in the market with its 3.49 per cent one-year fixed rate mortgage.

The flexible fix mortgage is available for loans of up to 90 per cent of valuation and allows borrowers to underpay, overpay, take payment holidays and make lump sum withdrawals. This gives a better degree of flexibility than some flexible mortgages. But the down side is that there is an extended tie-in so borrowers who redeem in the first three years must pay three months&#39 interest and there is an arrangement fee of £325.

According to Moneyfacts on December 19, 2000, the Private Label flexible fix mortgage has a lower interest rate than its nearest competitor, the Yorkshire Building Society mortgage, which is a one-year fixed rate flexible mortgage at 5.99 per cent.

The Yorkshire Building Society mortgage has the same degree of flexibility as the Private Label mortgage and although it has a higher interest rate, it has the advantages of having no early redemption penalties, free accident, sickness & unemployment insurance for six months and an arrangement fee of £100, which is lower than the Private Label mortgage.

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