Coventry Building Society’s range of early redemption charge-free five-year fixed rates have been selected as this week’s Mortgage Deal of the week.
Ray Boulger, senior technical manager at John Charcol, pointed out Coventry Building Society’s range of early redemption charge-free five-year fixed rates are the only ERC free fixes available in the market for longer than two years.
For many borrowers who like the rate security offered by a medium term fixed rate but also the ultimate flexibility to redeem at any time in case they want to move home or their personal circumstances change, Mr Boulger said the small rate premium compared with the most competitive rates available with ERCs will be a price worth paying.
The rates are 2.74 per cent up to 65 per cent loan-to-value (LTV), 2.95 per cent to 75 per cent LTV, 3.15 per cent to 80 per cent LTV, 3.19 per cent to 85 per cent LTV and 3.65 per cent at 90 per cent LTV.
At all rates there are no lender fees, a free valuation up to £1m and on remortgages also free legal fees.
The end dates are 31 December 2020 and as Coventry borrowers paying its SVR qualify for a 0.25 per cent reduction after five years, Mr Boulger points out these mortgages automatically revert to this privilege rate, currently 4.49 per cent.
However Moneyfacts picked Tesco Bank’s five-year fixed rate as their mortgage deal of the week, after it was reduced to 2.59 per cent
This is available for all applicants borrowing from £40,000 at 80 per cent loan-to-value.
A fee of £995 is payable, of which £800 can be added to the advance of the mortgage.
The bank is also offering an incentive package for remortgage customers of free valuation and free legal fees and Tesco Clubcard holders will receive one Clubcard point for every £4 made in mortgage repayments.
Moneyfacts suggested the deal puts Tesco Bank as the joint lowest priced in its sector.
The price comparison side also chose Loughborough Building Society’s new two-year fixed rate, priced at 2.49 per cent, as its other pick of the week.
The offer is available to all customers who borrow between £25,000 and £350,000 at 90 per cent LTV.
It has a £599 fee, of which £499 can be added to the advance of the mortgage.
Elsewhere in the market, this week TSB went the other way, ‘adjusting’ its residential rates on three short and medium term mortgages.
The bank’s two-year fixed and tracker mortgage will increase 0.10 per cent for homeowners with a LTV of 60 to 75 per cent, while homeowners looking for a five-year fixed mortgage with a LTV of 0-60 per cent will also see an increase of 0.1 per cent.
Meanwhile, Ipswich Building Society has launched five new mortgage products to increase its support for “mortgage misfits”, specifically the self-employed and contractors; available direct and through selected brokers.
Its self employed specialist mortgage is a two-year discount rate, currently at 3.59 per cent up to 75 per cent LTV and available up to a maximum value of £350,000.
There is also a two-year discount rate product, currently at 3.99 per cent up to 90 per cent LTV and available up to a maximum value of £500,000.
The society has also launched a contractors’ mortgage, specifically designed for IT and other professional contractors such as project managers and interim executives; those who undertake contract work on a regular basis.
Again a two-year discount rate at 3.99 per cent up to 90 per cent LTV is available up to a maximum value of £750,000.
Chief executive Paul Winter said: “Too many credit-worthy borrowers with unusual circumstances are overlooked by mainstream mortgage lenders and our view is that ‘mortgage misfits’, including the self-employed and contractors, should have the same level of choice and access to the mortgage market as any other group.”
Earlier in the week, FTAdviser also covered Accord Mortgages cutting its residential rates by up to 0.3 per cent across two-year fixed rate 90 per cent LTV products, with some mortgages including £250 cash back on completion and a free standard valuation.
Yorkshire Building Society Group’s intermediary-only lender is now offering a 90 per cent LTV two-year fix at 2.39 per cent with a £845 product fee, available for purchases and remortgages.
peter.walker@ft.com
