Mortgage Products

Fixed Rate

A fixed rate mortgage allows you to fix your level of repayment, irrespective of any interest rate fluctuations. This means your monthly repayments will remain the same every month for a period agreed between you and your lender.

Standard Variable Rate (SVR)

The SVR is the lender’s standard rate. With a variable rate mortgage, you are normally able to switch lenders at any time without penalty. If you take out a mortgage that has a fixed, tracker or discounted rate, once the agreed period comes to an end, the loan will usually revert to the lender’s SVR.

Discount

The discount mortgage is a variation on the standard variable rate mortgage. It provides a discount from the lender’s SVR for an agreed period. The variable interest rate does fluctuate, meaning your monthly repayments may differ slightly from month to month, but the discount remains constant.

Fixed, Tracker and Discount rate mortgages often have early repayment charges, so you need to be sure this is suitable for you and your foreseeable future. Furthermore, the lender may charge a ‘booking/arrangement fee’ to apply for these types of mortgage. You can ask your advisor to explain these in more detail, or request an illustration.

Tracker

A tracker mortgage usually tracks, for an agreed period, any movement in an index specified by the lender – for example, the Bank of England base rate. This means that you will benefit from any falls in interest rates, but also means that you will have to pay more each month should the rate increase.