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Product Matters

The 4.84 per cent rate from NottinghamBuilding Society, fixed until February 1, 2008 and available to 90 per cent loan to value, is keenly priced and deserves to seize market share from others.

Loans up to 95 per cent LTV attract a slightly higher but competitive 4.99 per cent rate.

Nottingham’s lead rate of 4.84 per cent is undercut by some, including Portman Building Society’s 4.79 per cent rate for three years. However, the Portman deal attracts a unwelcome £499 arrangement fee, imposes a 4 per cent early redemption charge throughout the fixed term and lacks assistance with legal fees.

In view of these new Nottingham products, you wonder why anyone would select Cheltenham & Gloucester’s fixed deal at 5.29 per cent to January 31, 2008 or even Cheshire Building Society’s 4.93 per cent. Neither of these deals offers free legal fees.

As you would expect with offerings focused on remortgages, Nottingham’s deals come with a free valuation as well as free legals when using a named solicitor.

What our advisers really like is the fact that loans are portable and carry an early redemption charge of six months’ interest as opposed to the more typical percentage of loan penalty.

Compared with Portman’s 4 per cent early redemption charge, this approach could almost halve the charge for a £120,000 borrower.

Nottingham permits up to 10 per cent capital repayments with no penalty during the product period.

Brokers say Nottingham’s mortgage processing service is consistently impressive so expect these deals to be in great demand.

Rob Clifford is chief executive at mortgageforce

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