Available from Mortgages plc, the product has been designed to help borrowers looking to clear outstanding debt to trustees or for them to enter into a one-off IVA which is then registered and satisfied on completion.
David Copland, sales and marketing director at Pink Home Loans commented: “A number of our brokers have been requesting this type of product for some time and we envisage it to be popular. It allows borrowers to repair their credit without being locked into a loaded product rate for three years or be subjected to high redemption penalties. Mortgages plc has definitely filled a gap in the market.”
The product is only available via Pink’s packaged route. Arrangement fees are set at £995, with rates available from 10.45 per cent.
When the deal ends, the client can look for a more mainstream deal with no penalties.
Pete Thomson, sales director at Mortgages plc, added: “The specialist mortgage sector was born out of providing innovative solutions to borrowers. This product has been designed to meet the needs of this growing market.”
However, Ian Crampton, sales director at Ferndown Ltd believed many borrowers would be put off by the product rate. He explained: “This is a short, sharp shock and will only fit a very small niche. People may find that they are better off committing to a two or three-year arrangement that has a more attractive interest rate.”
