After the initial period the loan reverts to the lenders standard variable rate (currently 5.74 per cent) until 1 May 2007, and thereafter a loyalty discount of 0.5 per cent applies.
The product is available for purchase – although not to first-time buyers – and for remortgage. Early redemption penalties are charged at six per cent in year one, five per cent in year two and four per cent in year three. However 25 per cent of the loan can be repaid in the first three years without penalty.
The maximum loan-to-value (LTV) is 95 per cent and a mortgage indemnity guarantee is payable for loans in excess of 75per cent LTV.
