Last week Brian Gibson gave first-time buyers some good news with Woolwich’s new guarantor-style 5% deposit mortgage. This week it’s the turn of interest-only products to make a comeback.

Of sorts. Clydesdale bank has just launched a new interest-only mortgage that reverts to repayment terms after three years. In other words, you get a short time to get the mortgage on an interest-only basis (at a fixed rate). After that you’ll be switched to standard variable rate repayments, currently at 4.95%.

It is good to see some lenders offering innovation around this area. Virtually all lenders have pulled out of the interest-only market (or placed such difficult conditions that is almost impossible for the criteria to be met). But there is still a need for some clients to have this option.

The rates range from 3.09% at 60% loan-to-value to 4.49% for 80% LTV. The fee is £999, rising to £1,499 for loans over half a million but not more than £1m.

Crucially, the Clydesdale mortgage will not be available via their branches – only by brokers. So contact Limetree if you are interested. We’ll help you to find out if it would work for your situation.

Posted in First Time Buyers, Mortgages, Next Time Buyers, Remortgaging