(LT30) 5 Year 2.71% Discount Floored RIO Further Advance

This five-year discount mortgage comes with an interest rate of 2.49%, which includes a 2.71% discount from our Standard Variable Rate for 5 years followed by our Standard Variable Rate for the remainder of the term, currently 5.20%. The interest rate for this mortgage is 'floored', which means that while the rate may increase, it will never fall below 2.49% during the discount period.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

(LT30) 5 Year 2.71% Discount Floored RIO Further Advance

Initial rate

2.49%

Subsequent Rate (SVR)

5.20%

Overall cost for comparison

2.80% APRC

Maximum loan to value (LTV)

50%

Incentives

None

Arrangement Fee

£150

Early repayment charge

None

Product Summary

Initial Rate

This five-year discount mortgage comes with an interest rate of 2.49%, which includes a 2.71% discount from our Standard Variable Rate for 5 years followed by our Standard Variable Rate for the remainder of the term, currently 5.20%. The interest rate for this mortgage is 'floored', which means that while the rate may increase, it will never fall below 2.49% during the discount period.

Portability

This further advance product is portable to a new residential mortgage on a different property when the new mortgage is taken out simultaneously with the repayment of the existing mortgage.

You would need to meet our credit and affordability requirements for the new mortgage, the new property would need to be acceptable to us, and approval of a new mortgage would be subject to our prevailing Lending Policy.

Repayment Method

Interest-Only. Monthly payments of interest will be required for the period of the mortgage.

Restrictions

Maximum LTV 50% for existing loan plus further advance

Minimum valuation £125,000

A Retirement Interest-Only Further Advance may only be taken if the existing mortgage is already a RIO Mortgage. If a RIO Advance is required, a product switch will need to be done to convert the existing mortgage.

Not permitted within 6 months of completion of the original mortgage, a valuation fee may be charged, and a credit & affordability assessment will be conducted.

Loan Size

Minimum £5,000 - Maximum £750,000

The total loan including the existing mortgage may not exceed £1,500,000.

Mortgage Term

There is no mortgage term, and the mortgage would continue for as long as you permanently occupy the property. The mortgage would continue until the date of sale/repayment by you or the Executor of your Estate. It would only need to be repaid after a Repayment Event has occurred.

Repayment Event

A Retirement Interest-Only Mortgage is provided on the basis that the Repayment Strategy for eventual repayment of the amount owing is the sale of the mortgaged property. 
 
The ability to arrange a sale of the property and the repayment of the mortgage would remain within the control of the owner/borrower until a Repayment Event occurs.
 
This mortgage does not have a specified Mortgage Term or Repayment Date. We will only require full repayment within 6 months of a Repayment Event. A Repayment Event is defined as when:
  • The property is permanently vacated, where this arises from both owners/borrowers or the final surviving owner/borrower (or the owner/borrower if it is in one name only) moving to reside in another property, or entering into sheltered accommodation or long-term care
  • The date of death of the final surviving owner/borrower (or the owner/borrower if it is in one name only)

Age Restrictions

Borrower(s) to be >=55 (at date of application)

No maximum age

Fee Details

A £150 arrangement fee will be charged.  This can be added to the loan on completion however this will result in interest being charged on it making the overall fee greater over the term of the mortgage.

Purpose of Advance

For improvements to the property or another reason can be discussed with us by exception.

Representative Example

A mortgage of £32,300, payable over 5 years, on an interest-only basis, with an initial rate of 2.49%, which includes a 2.71% discount from our Standard Variable Rate for 5 years, would require 60 monthly payments of £67.02.

The total amount payable would be £36,756.20 made up of the loan amount plus interest (£4,021.20), Additional Borrowing Arrangement Fee (£150) and a Standard Valuation Fee (£285).

The overall cost for comparison is 2.80% APRC representative.

Important Notes:

Once the product matures the interest rate will revert to our Standard Variable Rate (SVR) unless a new product is taken out. Our SVR is currently 5.20%. This is set by us and may go up or down in the future.

The Overall Cost for Comparison is given as the Annual Percentage Rate of Charge (APRC) and includes all charges incurred relating to the mortgage/product. The APRC enables you to compare the cost of different products.

The Maximum Loan to Value (LTV) is calculated by us using your current mortgage balance, the proposed further advance, and our current assessed valuation of your property.

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YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH REPAYMENTS ON YOUR MORTGAGE