More discounted variable rates available

by Aaron Strutt

Jun 03 2011

The number of discounted variable rates, which are linked to the lender's standard variable rate (SVR) and can be increased at its discretion, has almost doubled in the last year. Figures from Moneyfacts show that there are now over 300 variable rates available.

Mortgage lenders like to offer discounted variable rates because they have more control over the amount that their customers pay. Over the last two-years there have been very few standard variable rate increases and this has led to lenders offering some ultra low discounted mortgages. Godiva Mortgages offer a two-year Flexx rate at 1.99% with a 1% discount from the SVR until June 2013. The arrangement fee is 1.99% of the loan amount and is capped at £1999. Borrowers will require a 40% deposit.

Trinity Financial can access The Hanley's discounted rate at 3.09% and it has a 2.10% discount from the SVR for the term of the mortgage. The arrangement fee is low at £495 and borrowers require a 20% deposit. There are no early repayment charges and they offer £250 cash-back for house purchases.

A number of lenders have continued to lower their mortgages this week and the Nationwide Building Society reduced some of their fixed rates by 0.5%.  Barclays has made their deals more competitive for the fourth time in six weeks and they now offer some great tracker rates. The lowest is a term-tracker at 2.47% and the arrangement fee is £999. You will require a 30% deposit to access the mortgage and the maximum loan is £1 million.

June 3, 2011