Post Office enters mortgage market

The Post Office, which already offers a number of other financial products, is to offer three prime products; one fixed rate at 6.09 per cent available up to 95 per cent loan-to-value (LTV), a buy-to-let deal at 6.35 per cent and a product for the self-employed, priced at 6.44 per cent, available up to 85 and 90 per cent LTV.

All are available with an arrangement fee of £399 and have no higher lending charge. Customers can access the products in selected branches, over the phone or online.

Gary Fitton, director of lending at the Post Office, said: “We believe there is a real need for straightforward mortgages, which don’t entice customers with headline grabbing rates and then penalise them with huge fees. This is why we have developed products with good initial and long-term value.

“Throughout the trial we will be assessing whether this stands true. At the same time we will ensure we provide the products and the service quality expected from the Post Office. A formal evaluation will take place at the end of the trial, which will inform how we proceed.”

John Malone, managing director of Premier Mortgage Services, said: “The most important ingredient in today’s market is advice. If it can provide good quality advice, that’s key.”

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