The lender says it is launching a new 4.99 per cent two year fixed rate mortgage with a 3 per cent fee, of which 2.75 per cent can be added to the loan even if the maximum 75 per cent loan to value has been borrowed.
This new deal, with a minimum loan value of £75,000, has been designed to help borrowers who want to fix their mortgage payments as low as possible to help them manage their monthly budgets.
Mortgage product manager Tom Girling says: “In the present climate with soaring petrol, utility and food costs, a number of borrowers are looking for the lowest possible monthly mortgage payments to help them survive financially.
“The new 4.99 per cent two year fixed rate deal is the lowest rate currently available and, whilst the fee is inevitably high, this can be added to the loan which keeps the pay rate down. The mortgage also offers an overpayment option should borrowers find themselves able to increase their monthly payments and therefore repay the fee in a shorter time than the full remaining mortgage term.
“We understand that this mortgage will not suit all borrowers, but it is offered as an option for those who may be finding that their monthly income is stretched to the limit. For borrowers who can afford a little more each month, we have mortgage options with lower fees and no fee products.”