Lloyds TSB has launched a new mortgage to allow borrowers to benefit from a fall in interest rates, while also being able to fix the rate at a later date.
Lloyds TSB says one in three homeowners will not be able to benefit from a fall in interest rates, expected at the end of 2007, by opting for fixed rates in case rates do rise again.
The new product, called Track & Lock, will follow the Bank of England base rate but allows the borrower to change to any Lloyds TSB fixed rate when they choose without incurring an early repayment charge.
Alison Burns, director of network mortgage sales at Lloyds TSB, says: “Currently just 15 per cent of homeowners have a tracker mortgage but as thousands face increased monthly repayments they need to consider all the remortgaging options available. By ruling out a tracker homeowners are missing out on the opportunity to capitalise on future rate drops.”
Each product is a five-year tracker mortgage, with the option to switch, and can lend up to 90% LTV with a £99 application fee and 3% early repayment charge.
For a £299 fee, borrowers will receive a rate of BBR +0.24% and a fee-free option gives a rate of BBR + 0.49%.
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