In the second year, homebuyers get a further one per cent discount on the standard variable rate.
Jon Round, head of mortgage development at Norwich Union, said: "This
mortgage rate is highly competitive and represents excellent value for borrowers. In addition to this low initial pay rate. No up front fees are required and borrowers also benefit from an additional one per cent discount in the second year of the mortgage term."
"By offering a reduced fixed rate in the first year followed by a discounted variable rate, this mortgage deal delivers cost savings when it is most required - in the first year of buying a new house-and the extra security of discounted rate in the second year."
Other features of the deal include redemption penalties of six months
interest at the payable rate in the first year then three months interest in the second year with no overhang.
The maximum loan to value (LTV) is 95 per cent and there is no mortgage indemnity premium payable up to 90 per cent. A procuration fee of 0.35 per cent applies, and there is a minimum of £125 and a maximum of £1,000.
