Alliance & Leicester announced further rate reductions yesterday on their 75% loan to value two-year fixed rates for new purchases.
The new product, with a £995 arrangement fee and a fixed rate of 4.53%, sits alongside their 4.48% product with a 1% arrangement fee.
The new rate brings them into line with rates from Abbey, but this product could benefit those who have recently gone self-employed or started a business; Alliance & Leicester require only one year of accounts minimum against two from Abbey. It also has a free valuation, much like Abbey’s three-year fix at the same rate.
The move continues the trend of lenders moving their products down to a similar baseline, but with no one currently undercutting the rest of the market, unlike what we have seen with variable rates from HSBC and Woolwich, although; swap rates have not dropped in the same fashion as Three-Month LIBOR which fuelled the reduction in variable rates.
The new rates have an APR of 5.1%, and the reversion rate currently stands at 4.99%. Early repayment charges are 3% of the loan until 31/12/2011, and the lender’s Conveyancing fee is typically £189.
Always consult the Key Facts Illustration before deciding on a mortgage product and seek independent advice. To speak to a mortgage advisor, call 0845 4594490.