Type: Self-cert tracker mortgage
Tracker term: Three years
Tracker rate: 0.34% above the Bank of England base rate
Payable rate: 5.09 %
Minimum loan: £25,001
Maximum loan: Up to 85% of valuation subject to a maximum of £500,000, Up to 65% of valuation subject to a maximum of £1m
Income multiples: Up to four times principal income plus second or 3.25 times joint
Conditions: Free standard valuation for purchase and remortgage applications
Arrangement fee: £495
Redemption fee: 3% of the original loan
Introducer’s fee: Subject to negotiation
Tel: 0845 940 1400
This deal from UCB Home Loans is available at an initial pay rate of 5.09 per cent for loans
John Charcol product specialist Ash Sharma points out that this deal, which is part of a new range of products introduced by UCB Home Loans, shows that self-cert lending is still strong in the market.
“The pick of products is a three-year tracker at bank base rate plus 0.34 per cent, giving a current pay rate of 5.09 per cent,” he says.
Sharma notes that the arrangement fee for this product is £495 and the deal has an early repayment charge of 3 per cent during the three-year tracker period.
Sharma observes that as with UCB’s other products, this deal is available up to 85 per cent of valuation. However, the downside is that unlike these other products, the 5.09 per cent deal does not have any flexible features.
“So for customers wanting to overpay, underpay or to take a payment holiday, this will not be the rate for them. The flexibility only applies after the three-year tracker term, by which time the customer would be on UCB’s flexible variable rate, currently 7.04 per cent.”
However, Sharma does like this product’s free standard valuation for both purchases and remortgages where UCB instruct.“For those wanting a low initial rate, this product offers the lowest initial rate within the self-cert three-year tracker class,” says Sharma.
He believes that the only other products which would compete would be Cheshire Building Society which has a deal at bank base plus 0.35 per cent. This is only available up to 80 per cent of valuation but it is fully flexible. Bank of Scotland also has a deal at bank base plus 0.49 per cent, available up to 85%. However, it is only available for remortgages with free valuation and free legal fees.
Suitability to market: Good
Competitiveness of rate: Good
Adviser remuneration: Average