Mortgage bulletin for week commencing Monday 11 August
Many homeowners benefit from low-rate fixed-terms mortgage deals but can be penalised if they pay their loan back early through Early Repayment Charges (ECRs). Many lenders only allow borrowers to repay up to 10% of the outstanding balance each year, but Tesco Bank allows up to 20%, either in the form of regular or lump-sum overpayments.
This facility is available on all of Tesco Bank's products, including its range of new mortgages which includes a two-year fixed-rate product at 1.89% up to 60% loan-to-value (LTV) and base rate tracker at 1.50% up to 60% LTV. The two-year fixed-rate has a booking fee of £195 and product fee of £1,300, while the tracker carries a £195 booking fee and £800 product fee.
David McCreadie, managing director at Tesco Bank, says, "We are delighted to launch these new mortgage products, which we believe reflect our commitment to offer a range of highly competitive mortgages for Tesco customers."
Meanwhile, Skipton has launched a range of fee-free seven-year fixed-rate mortgages from 60% to 90% LTV, unique to the UK market. Rates include 3.99% to 60% LTV, 4.19% to 75% LTV, 4.89% to 85% LTV and 5.39% to 90% LTV.
Skipton's new two-year residential fixed-rates includes a low rate, higher fee option at 2.35% with a £195 application fee and a £1,800 completion fee for loans up to 75% LTV, while the lender's five-year fixed-rate deals now include no-fee deals at 3.49% for loans to 60% LTV and 5.19% to 90% LTV.
All of the above allow overpayments of up to 10% per annum without penalty, are available for purchases and remortgages, offer free standard legals and valuations for remortgages and are available through the customer service centre, branches and intermediaries.
Kris Brewster, the Society's head of products, says, "With the continuing uncertainty over Bank of England base rates we have taken the major step to offer our customers seven year fixed rate products which will enable them to plan for the future knowing that their mortgage repayments will remain static for the longer term."
Leeds Building Society has made further changes to its range of two year fixed rate buy-to-let mortgages. Deals include a 2.99% two-year fixed-rate up to 65%, with a £799 fee, a 2.79% two-year fixed-rate up to 60%, with a £999 fee and a 3.09% two-year fixed-rate up to 60% with a lower £199 fee.
Each of the above products includes a free standard valuation up to £335 and free in-house legal services for remortgages.
Martin Richardson, Leeds Building Society's general manager of business development, says, "The majority of buy-to-let borrowers favour two-year fixed-rates and these changes to our range make these products among the most competitive on the market."
Leeds Building Society is also offering a range of "Welcome" mortgages through intermediaries, where borrowers pay 0% interest for the first three or six months. Rates are 3.38% on loans up to 80% LTV and 4.07% up to 85% LTV. Both deals are free of product arrangement fees, offer free valuations up to £335 and £200 cashback on completion.