by Mark Johnston
The troubled Newcastle based British Bank Northern Rock, has reduced its rates on a range of everyday residential mortgages and further reduced its but to let products by up to 0.5%.Northern Rock, famed for being the first bank in 150 years to suffer a bank run had to approach the bank of England for a loan at the height of the banking crisis. Having failed to find a buyer for then business it was taken into public ownership in 2008. Since then the bank has been working hard to rebuild its business.
On 23rd February this year Northern Rock announced that they would be offering £14 billion of new mortgages over the next few years. The new business plan would be funded by an increase in the government loan, a reversal of previous strategy to pay the loan off as quickly as possible by actively encouraging mortgage customers to leave when their mortgage deal matures.
Northern Rock offers a range of mortgages products that cover first time buyers, buy to let, those moving home and borrowers who are looking to remortgage.
For those looking to get onto the property market, Northern Rock has what they are branding an ‘Everyday’ mortgage. Their rates change depending on the size of the deposit you have. Their best deal is a 3 year tracker at 2.89% which reverts to their standard variable rate (SVR) of 4.79% after the 3 year term is up. Maximum loan to value (LTV) is 70% and the fee is £995 giving an overall cost for comparison of 4.4% APR
For those who don’t have a larger deposit the northern based bank is offering a 3 year fixed rate mortgage at 5.29% which reverts to their standard variable rate (SVR) of 4.79% after the 3 year term is up. Maximum loan to value (LTV) is 85% and the fee is £995 giving an overall cost for comparison of 4.9% APR
The Everyday five-year fixed rates for customers that have a 30% deposit start at 4.39% Those with a slightly less deposit of 25% would pay 4.59% Both products have a product fees of £995 and revert back to their standard variable rate (SVR) of 4.79%.
Northern Rock has also made reductions to its two-year and three-year fixed rate products. Two year fixed rates start from 3.15% and three-year fixed rates start from 4.10%.
Both these mortgages are available to those looking to buy property as well as those looking to remortgage. The mortgages have a loan to value (LTV) of 70% which means a 30% deposit and again have a product fee of £995.
As well as reducing these mortgages, the bank has reduced the product fees on buy to let products by up to 0.5%. The Everyday buy to let two year fixed rate start from 5.69%, require a 30% deposit and include a 2% product fee.
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