The self-certification mortgage lets borrowers with an impaired credit history to borrow up to £250,000 for purchases or re-mortgages. However, the deal only applies to applicants who have got County Court Judgements (CCJs) of less than £5,000 and who are seeking a loan-to-value of up to 85 per cent.
If they fulfill this criteria there is then the option of either a fixed 1.5 per cent discount until June 2003 which gives an initial rate of 6.45 per cent. Or a fixed rate of 5.45 per cent until 31 March 2003.
"This is a great deal for sub-prime borrowers," said Gary Forrest, joint managing director of High Street Home Loans. "We put a lot of time, energy and resource into our product development and, as a consequence, we are able to deliver products that intermediaries and their clients want. If borrowers take up our two-year discount offer they will be getting a sub-prime mortgage that has an interest rate of 4.45 per cent. That is as good as the best prime deals. The days have gone whereby sub-prime borrowers were penalised heavily because they had got historical debt problems. And about time too."
Nevertheless an early redemption payment of six per cent of the outstanding capital balance will apply for the first three years of the loan, and thereafter, a redemption payment of one months’ interest will be charged.