MortgagesMay 9 2013

Coventry extends Flexx and Offset products

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The new products on offer from 30 April include a 2.45 per cent, two-year fixed-rate mortgage, at 65 per cent LTV, available until 30 June 2015 and a five-year fixed-rate at 3.69 per cent, and an 80 per cent LTV, available until 30 June 2018.

A Flexx for term mortgage is also available at 3.25 per cent which has a LTV of 80 per cent and a two-year Offset Flexx for term mortgage at 2.99 per cent, and an LTV of 75 per cent available until 30 June 2015.

PROVIDER VIEW

Colin Franklin, sales and marketing director for Coventry Building Society, said: “Our highly competitive range of Offset Flexx for Term mortgages has just got even better. With additional products available up to 80 per cent LTV, now even more borrowers can benefit from our great rates and flexibility. And as always, all products include a valuation of up to £670 and access to our remortgage transfer service.”

ADVISER VIEW

Ronan Marrion, mortgage specialist at Cornwall-based Worldwide Financial Planning, said: “Lenders are all competing to get good rates onto the market for customers. While these ones are okay, they are not the best available. They should be in demand, however. The 65 per cent LTV two-year fixed-rate product is good value, because although it has a booking fee, it does include the valuation fee. The 80 per cent LTV, five-year product is also quite good. There are better rates available on the market, but they also have larger fees attached. The two-year offset product is not bad. It is an anomaly however, because there are not many of these around, so it should be popular.

CHARGES

The 2.45 per cent two year fixed rate product has a £199 booking fee, £300 arrangement fee and early repayment charges of 3 per cent of the balance, until 30 June 2015. The same charges apply to the five year 3.69 per cent fixed rate product, with the 80 per cent LTV.

The 3.25 per cent Flexx for Term mortgage with the 80 per cent LTV also has a £199 booking fee, but has a £800 arrangement fee and no early repayment charges. The 2.99 per cent offset mortgage has the same booking fee, arrangement fee and early repayment charges as the two year and five year fixed rate products.

VERDICT

Coventry Building Society emphasises its flexibility and competitiveness, which is the case up to a point, but its rates are unlikely to be the best available. Competition is stiff, as lenders seek to attract more customers and increase market share.

The booking fees are not the highest on the market and together with the arrangement fees are to some extent offset by the included valuation fee, but the £800 arrangement fee for the Flexx for Term product with the 80 per cent LTV could give some advisers and customers pause for thought.

The remortgage transfer service could be worth considering as part of these deals. It offers customers either payment of their legal fees or a reduced fee package, depending on the product selected.

The service includes the standard legal process work on the remortgage, undertaken by the Society’s appointed solicitor. The Society says that most borrowers pay nothing for the process, but there are some administrative exclusions to be aware of, such as reassigning life assurances associated with old loans.

There could also be some costs, as registering the mortgage at the Land Registry is included up to the value of £50. There is also a limit for payments to the Land Registry for their search services and paying the registration fee.

The society says that most borrowers’ transfers are completed within ten days of the mortgage offer.