The rate is Bank of England Base Rate + 2.69% for the first two years, with early redemption charges only extending over the initial two year period (5% in year in year one and 4% in year two. In a feature designed to retain borrowers after the introductory period, the rate drops to Base Rate + 1.99% for the rest of the life of the loan. Maximum CCJ value is £2000 (none in the last 12 months) and maximum mortgage arrears are two months (not increased in last 12 months). The product is for status applicants only – no self certification of income is available.
Tony Salentino, director of CMLS, said. “This product offers an outstanding opportunity for sub prime applicants to rebuild their credit profile, and then move to an attractive lower rate after two years. Increased property values mean that the LTV will have dropped after two years, so the lender is reflecting the decreased risk by lowering the rate – when normally rates would revert to a higher standard variable rate. It is also rare for 95% LTV to be offered with levels of £2000 CCJs and two months arrears, making this product a “must” for sub prime cases that need a high LTV. The product is a limited tranche – so early application is advisable”
