The stepped rate mortgage is available at an initial rate of 4.99 per cent, fixed for two years. The product rate then reverts to Base Rate plus 0.74 per cent for one year, before reverting to the standard variable rate, currently 7.39 per cent.
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The offer is available up to 95 per cent loan-to-value, with a product fee of £999. A maximum loan of £999,999 is in operation, with an early repayment charge of 3 per cent of the outstanding balance if the mortgage is redeemed during the initial three years.
A&L has also launched an ‘intermediary special’ two-year fixed rate. Available at an initial rate of 4.99 per cent, the offer is available to those looking to borrow over 90 per cent of the property value.
Mehrdad Yousefi, head of intermediary mortgages at A&L, said: “Our range includes several deals which are priced below 5 per cent which is great news for brokers and their clients.
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“We have launched a stepped mortgage which is ideal for those who are buying a home and want to keep their initial costs as low as possible, while not suffering from a ‘payment shock’ in two years’ time.”
Rod Murdison, proprietor of Murdison & Browning, said: “The product has been very cleverly priced. It can be beaten, but it’s a competitive deal with the mix of fixed rate and arrangement fee of £999, like many other stepped products. However, it has a high fee and A&L has one of the highest redemption administration fees in the market.”
