(LT22) 2 Year 2.81% Discount Floored RIO

This two-year discount mortgage comes with an interest rate of 2.39%, which includes a 2.81% discount from our Standard Variable Rate for 2 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 2.39% during the discount period.

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

(LT22) 2 Year 2.81% Discount Floored RIO

Initial rate

2.39%

Subsequent Rate (SVR)

5.20%

Overall cost for comparison

5.10% APRC

Maximum loan to value (LTV)

50%

Incentives

None

Arrangement Fee

£499

Early repayment charge

Yes

Product Summary

Initial Rate

This two-year discount mortgage comes with an interest rate of 2.39%, which includes a 2.81% discount from our Standard Variable Rate for 2 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 2.39% during the discount period.

Portability

This mortgage 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.

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)

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.

Restrictions

Lending restricted to England and Wales

Youngest borrower to be >=55 (at date of application)

Minimum property value £125,000

No maximum age

Loan Size

Minimum £25,000

Maximum £750,000

Fee Details

£499 - 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.

Early Repayment Charge Details

A full or partial capital repayment, which exceeds 10% of the capital balance amount in any one year during the discount period, will attract an early repayment charge of:

2% in the 1st year

2% in the 2nd year 

This will not be charged if the sale of the property and repayment of the mortgage is related to the death of the borrower, or if a joint mortgage, the death of the final surviving borrower.

Representative Example

A mortgage of £56,000 payable over 26 years on an interest-only basis with an initial rate of 2.39% which includes a 2.81% discount from our Standard Variable Rate for 2 years and then on our Standard Variable Rate, currently 5.20% for the remaining 24 years. The first 2 years would require 24 monthly payments of £111.53 followed by 288 monthly payments of £242.67.

The total amount payable would be £129,769.68 made up of the loan amount plus interest (£72,565.68), Arrangement Fee (£499) Valuation Fee (£285), Solicitor Fee (£250), Funds Transfer Fee (£15) and a Mortgage Exit Fee (£155).

The overall cost for comparison is 5.10% 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 and our current assessed valuation of your property.

Help Centre

Important Information to consider if you take out a RIO mortgage


IMPORTANT INFORMATION

3 easy ways to apply

Apply online

Enquire Online

Complete our quick online enquiry form and we'll get back to you within one working day.

ENQUIRE ONLINE
Apply in branch

Apply in Branch

Arrange to meet an expert Mortgage Adviser in one of our six branches.

BRANCH FINDER
Apply by phone

Give us a Call

0161 429 4318

Monday - Friday

08:45 - 17:00

Help Centre

Got a question about mortgages?

Visit our Help Centre for answers to mortgage frequently asked questions, important leaflets and guides.
READ MORE
Help Centre

Mortgage Jargon Buster

Don't get bamboozled by Mortgages. We've pulled together a list of useful terms to help you out.
READ MORE
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP WITH REPAYMENTS ON YOUR MORTGAGE