Key Features
- Mortgage type
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- With a discounted rate mortgage, the lender's standard variable rate (SVR) is discounted for a specific period of time. The interest rate will vary as the lender's standard variable mortgage rate moves up and down but the amount of discount will remain the same.
- Interest rates
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- 5.75% variable. Our SVR with a 1.00% discount for the first 5 years, changing to our SVR for the remainder of the mortgage, currently 6.75%.
- Maximum loan to value
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- 50 %
- Fees
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- Application Fee: £600 (purchase or remortgage)
- Application Fee: Remortgage £850
- £0 (Existing borrower product transfer)
- Mortgage Exit Administration Fee (MEAF): £100
- Features
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- Newbury Building Society will pay the first £700 of the standard mortgage valuation (this will cover properties valued up to £1,000,000).
- Overpayments allowed
- Loan size
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- £50,000 (min) - £500,000 (max)
- £40,000 (min) - for existing borrowers transferring onto the product
- Early repayment charge (ERC)
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- The Early Repayment Charge (ERC) period applies from the date of completion.
- For this product the ERC period is 3 years from the date of completion.
- ERC is 3% in year 1, 2% in year 2 and 1% in year 3 of the original loan amount (or the balance outstanding on the date an existing mortgage is transferred to this product).
- During the ERC period you are permitted to make overpayments up to 20% of the original loan amount (or the balance outstanding on the date an existing mortgage is transferred to this product) per year. If overpayments exceed 20% in a year during the ERC period, you will have to pay the relevant ERC percentage rate on the amount of overpayment exceeding the permitted level.
- The full ERC is payable on the original loan amount (or the balance outstanding on the date an existing mortgage is transferred to this product) if you repay your mortgage in full during the ERC period. The ERC will also be levied on previously permitted overpayments.
- Eligibility
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- The property must be located in England or Wales.
- RIO mortgages are termless interest only mortgages available to those aged between 60 and 80 (the maximum age at application is 80), retired and in receipt of a pension or other ongoing income. Minimum income per application is £30,000.
- Available to those purchasing or remortgaging their residential home subject to product terms.
- Also available for existing borrowers to transfer their existing mortgage into, subject to payment of any ERC's that apply on their current mortgage and for existing borrowers moving house.
- Mortgage will be on an Interest only basis.
- Minimum property value of £150,000
Representative example
A mortgage of £62,850 (including an application fee of £850) payable over 13 years initially on our standard variable rate, currently 6.75% with a discount of 1% for 60 months giving a current rate payable of 5.75% and then on our standard variable rate, currently 6.75% for the remaining 8 years would require 60 monthly payments of £301.16 and 96 monthly payments of £353.53.
The total amount payable would be £114,958.48 made up of the loan amount plus interest of £52,008.48 and a MEAF of £100.
The overall cost for comparison is 6.5% APRC representative.
Please note the term shown is for illustrative purposes only. The actual term of the loan may be longer or shorter than the term shown.
Additional information
WE HAVE NO CURRENT PLANS TO WITHDRAW THIS PRODUCT BUT IT MAY BE WITHDRAWN WITHOUT NOTICE.
YOUR MORTGAGE IS SECURED ON YOUR HOME. THINK CAREFULLY BEFORE SECURING ANY OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
- Legal work is required when buying your home and when switching your mortgage to us from another lender (remortgage). When buying your home the legal work is carried out by a solicitor and is payable by you. We can use the same solicitors as you, providing there is a minimum of Four Approved Managers/Licence Holders and they are registered on The Law Society website (www.lawsociety.org.uk). Licenced conveyancers are also acceptable for residential business only. The conveyancer must be registered with the Council of Licenced Conveyancers and be in a firm with at least four Approved Managers/Licence Holders.
- You can upgrade to a Home Buyers report if you wish and if you would prefer a full building survey, we can give you the names of some local surveyors who can organise this for you. (see our Mortgages Explained booklet for valuation and home buyer fees).
- If an existing borrower who is not moving house would like a revaluation carried out to assess which LTV tier they qualify for they will be required to pay a revaluation fee (see our Mortgages explained booklet for details).
- We will pay the first £700 of the standard mortgage valuation, providing the mortgage completes (this will cover properties valued up to £1,000,000). If your valuation fee is more than £700 (i.e. your property value is more than £1,000,000), you are responsible for paying the difference. If the mortgage does not complete and the valuation has been carried out, you are responsible for paying it.
- Loan to value (LTV) is the proportion of the value or price of the property (whichever is lower) that you borrow on a mortgage. For example, a £100,000 mortgage on a house valued at £200,000 would mean a LTV of 50%.
- The application fee can be added to the mortgage and is refundable if the mortgage does not take place. If you add the application fee to your mortgage, this increases the amount you borrow and will also increase your monthly payments.
- A Mortgage Exit Administration Fee (MEAF) applies when you repay your mortgage. Please see our Tariff of charges leaflet and your European Standardised Information Sheet (ESIS) for details.
- House purchases must complete within six months of the date of the formal mortgage offer. Remortgages must complete within three months from the date the application is received. Further advances must complete within three months of the date of the further advance offer.
- Where existing borrowers transferring their mortgage are not in an early repayment charge period, the transfer must take place within four months of the mortgage offer.
- For new build properties the mortgage offer is valid for up to 6 months. The application must be able to complete in the product time scales. Therefore, the new build property must be completed and available for occupation within six months of the mortgage offer.
- All our mortgages are portable, which means that if you move house within an early repayment charge period the product can be transferred to your new mortgage, up to the value of the product outstanding at redemption, without charge. If the loan amount on your new mortgage is lower, there may be a charge based on the difference between the old and the new loan amount. A higher lending charge may be applicable for the new mortgage.
- Charges applying to the ongoing administration of your mortgage are detailed in our Tariff of charges PDF, which you will be given before your mortgage completes.
- PLEASE NOTE: You should be aware that for the period you are paying interest only you are not reducing the capital borrowed.
- The mortgage is payable on death or a permanent move into residential care.
- In the case of a joint mortgage, we will take into account the ability of the surviving borrower to meet the mortgage commitment on death of a joint borrower or when a joint borrower moves into long term care.
- You are strongly recommended to seek independent legal advice before entering into this mortgage contract.
- You are strongly recommended to discuss this mortgage arrangement with your family or anyone else who may be affected, and to consider a lasting Power of Attorney.
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