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Stroud & Swindon drop-lock loan to offer penalty-free fix

Stroud & Swindon Building Society’s intermediary arm ITL Mortgages is planning to offer a product that allows borrowers to switch to a fixed rate at any time without a penalty charge.

The drop-lock deal would allow clients to switch from a tracker or to a fixed rate at any time during the contract.

The firm is still deciding whether the deal will be available to the whole of the intermediary market or to selected distributors.

Sales and marketing director Linda Will says the drop-lock mortgage puts the client in control and gives them options when the base rate eventually rises.

She says: “The idea is to give people a series of products that have built-in options. If everybody thinks interest rates are going to start climbing within a year, these products will give you an option of switching to a fixed rate but they do allow you to continue to enjoy the benefits of lower interest rates in the short term.”

John Charcol senior technical manager Ray Boulger says: “I think it is the right time to be looking at drop-locks because it is very difficult to know when interest rates will go up.My gut feeling would be it will probably be right to stay on a tracker rate for quite some time but things can change very quickly.”

Money Marketing understands a number of other lenders are considering offering drop-lock loans in the near future.

Nationwide currently offers a switch and fix deal which allows borrowers to switch from a tracker to fixed deal without early repayment charges.


Gummer: £29,398 repayment

Gummer’s mp expenses are mown down by legg

Aifa chairman and Conservative MP for Suffolk Coastal John Gummer has repaid £29,398 in expenses deemed excessive by Sir Thomas Legg’s review. Gummer claimed for gardening, lawnmower servic- ing and cleaning, which were retrospectively classified as excessive in Sir Legg’s review of MPs’ expenses. Gummer came fifth on the list of MPs with the biggest […]

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Auto-enrolment — don’t leave it too late…

With auto-enrolment (AE) well under way for the UK’s largest businesses, over the next three years an additional 800,000 smaller employers (with less than 60 employees) will start their journey to comply with the legislation. AE mandates all eligible employees and their respective employers to make regular pension contributions into a qualifying pension scheme. To learn more about the legislation read our brief Jelf AEase — simple steps to AE compliance guide.


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