This is a variable rate mortgage product which means monthly payments can go up or down during the term of the discount period. This is different to a fixed rate product. The rate of interest is linked to the Society’s Standard Variable Rate (SVR) for mortgages. During the first 2 years, the interest rate charged will be 1.21% below the Society’s SVR – this is the discount period and rate.
The lowest interest rate you might pay during this period will be 3.99% which is called the “floored” rate. This means that if the Society’s SVR is below 5.20% at any time during the period of the product, you will not benefit from the full rate of discount of 1.21%.
Three months before this product ends, we will contact you with the options available. If you do nothing at the end of the product period, you will move to the Society’s SVR which may mean your payments increase.
This product is available on:
A Capital & Interest repayment basis. This means your monthly repayments will contribute to paying back the initial loan as well as the monthly interest on the remaining balance. Over time, this will mean the amount owed will reduce and the interest will also reduce.
An Interest-Only repayment basis. This means that your monthly repayments will only pay back the interest on your initial loan amount. The capital balance will not reduce. You will need to agree with us up front, a suitable method of repaying the initial loan at the end of the mortgage term.
If Capital & Interest is the chosen repayment method, this product will allow interest-only repayment during the build and revert to Capital & Interest on completion.
This product is available for properties in England and Wales.
There is a £1,999 fee payable for setting up this mortgage.
This product is available for loans of at least £200,000 and up to £750,000.
This product releases funds on completion of each build stage.
Upon completion of the build, you will be transferred to a mainstream product at no extra charge.