Discount Rate Mortgages

Discounted mortgages are offered by lenders in order to attract new customers. They are an attractive proposition too. For a fixed term, you will be offered a fixed discount (expressed as a percentage) off the lender’s standard variable rate.

As with fixed rate mortgages, discount mortgage terms typically last between 6 months and five years. The level of discount will vary too, usually according to the length of term. So the discount for a 6 month term will be greater than that for a five year term.

This type of mortgage, especially the shorter term products, are popular with those who move house and want to spend money in the first few months on home improvements. They are also popular with those who want a few months to recover from the expenses incurred when purchasing a new home.

After the discount term has ended you will automatically revert to the lender’s standard variable rate. This can come as a shock, especially if you have been enjoying a significant discount. To get round this, you may choose to remortgage at the end of the term, perhaps selecting yet another discounted product.

Watch out for any penalties attached to a discounted product. Lenders may charge you if you decide to switch mortgages before the discount term has ended.

For more information please click on the type of mortgage you are interested in:

• Flexible Mortgages - Flexible repayment plan mortgages
• Current Account Mortgages - Mortgages linked to current accounts
• Discount Rate Mortgages - Promotional discounted rate mortgages
• Cashback Mortgages - Cashback mortgage deals
• Free valuation or refund of fees/Legal costs - Additional mortgage incentives
• Mortgage Protection - Insurance for mortgages

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