Scottish Building Society is pitching its flexible mortgage at Scottish borrowers.
The Scottish flexible mortgage has a discount of 2 per cent for the first six months of the mortgage for loans of up to 90 per cent of valuation. This gives it an initial payable rate of 4.25 per cent.
The mortgage offers underpayments, overpayments and payment holidays. However unlike many other flexible mortgages, interest is calculated monthly and there is no facility for lump sum withdrawal.
There is no early redemption charge and the mortgage also comes with free redundancy cover for the first five years of the loan.
Looking at the flexible mortgage market, the Scottish Building Society product is the most competitive six-month discount mortgage. The next cheapest is from Newworld. This has a discount of 1.79 per cent for the first six months, giving it a payable rate of 4.45 per cent for loans of up to 80 per cent of valuation. The Newworld mortgage is fully flexible.