Type: Fixed rate mortgage
Fixed term: Until September 30, 2011
Fixed rate: 6.84%
Minimum loan: £16,000, £26,000 for remortgages
Maximum loan: Up to 75% of valuation subject to a maximum of £1m, up to 70% of valuation subject to no maximum
Income multiples: Up to 4.5 times principal income or 4.5 times joint
Conditions: Capital repayments of up to 25% allowed within fixed-rate period without penalty, free valuation and legal fees for remortgages
Arrangement fee: £750 plus £249 reservation fee
Redemption fee: 3% of mortgage balance in year one, 2% in year two and 1% in year three
Introducer’s fee: Refer to lender
Tel: 08456 024598
This intermediary only deal is fixed at 6.84 per cent until September 30, 2011 and is available for loans up to 75 per cent of valuation.
Looking at the ways in which this deal is good for IFAs and their clients, Unleash Advice Partnership IFA Adrian Kidd says: “It has good incentives for remortgages and a decent income multiplier for cases that may not fit elsewhere. The best feature for me would be the ability to pay 25 per cent of the loan without penalty which is a lot higher than most fixed rate mortgages.”
However, the good points are overshadowed for Kidd by the rate. “This rate is not competitive at all in my eyes. There is a deluge of better priced deals ahead of this on the sourcing systems. I would only recommend this product based on client desires to overpay aggressively, or if they were on a tight income case. Nothing else makes me like it.
Scanning the market for potential competitors, Kidd says there are too many to mention.
“Northern Rock has a flexible fixed rate at 6.79 per cent with no fees, but the best three-year fix would be Abbey at 6.39 per cent. This has a cheaper booking fee at £845 and the rate is 0.45 per cent cheaper.
Suitability to market: Average
Competitiveness of rate: Poor
Adviser remuneration: Average