Clydesdale Bank launches 0.99% discounted mortgage rate

by Aaron Strutt

Apr 08 2018

Clydesdale Bank has launched a 0.99% discounted rate for mortgages between £80,000 and £400,000.

The lender provides a 3.96% discount from its 4.95% standard variable rate until 30 June 2020. The initial 0.99% rate is available for purchases and remortgages. 

At the end of the discounted period, the rate reverts to the bank’s standard variable rate. The overall cost for comparison is 4.38% APRC representative.

Clydesdale Bank’s 0.99% rate has a £1,499 arrangement fee, and applicants will need a 40% deposit to qualify. The bank provides a free property valuation and legal service if you are switching from another lender and the mortgage has to be taken on a capital repayment basis.

Early repayment charges apply until 30 June 2019 and the rate will almost certainly increase in line with any future Bank of England base rate increases.

Aaron Strutt, product director at Trinity Financial, says: “A few of the lenders pulled their sub-1% rates when the base rate, so it is surprising Clydesdale launched such a low rate. There are lots of tracker rates available but they are at least 0.2% more expensive.

“If you are looking for a larger mortgage HSBC has a competitively priced tracker rate.”

Representative example: A mortgage of £250,000 payable over 25 years, initially on a discounted variable rate for two years at 0.99% and then on a variable rate of 4.95% for the remaining 23 years, would require 25 monthly repayments of £941.05 followed by 275 monthly repayments of £1,408.92. The total amount repayable would be £413,463.25 made up of the loan amount, plus interest (£160,979.25) and fees of £1,499. The overall cost for comparison is 4.38% APRC representative.

The actual rate available will depend on your circumstances. Please ask for a personalised mortgage illustration.

To secure a low mortgage rate call Trinity Financial on 020 7016 0790