On the 2nd of February first direct (firstdirect.com) launched a new best buy offset tracker mortgage which tracks the Bank of England base rate plus 1.89% (currently 2.39%).
The mortgage requires a 65% loan to value and has an arrangement fee of £999.
It must be pointed out that research from first direct shows that many home-owners still do not understand the benefits of offsetting .
Actually, just two of them in 10 (21 per cent) see offsets as a way they can save money on their mortgage. And close to half (48 per cent) admit they don’t understand the basic principle.
The key features of first direct’s offset tracker mortgages are:
- financial benefit of offsetting any credit balances against the mortgage
- customers don’t receive interest on their linked savings with an offset Mortgage, instead reducing the amount of interest on their borrowings, they don’t have to pay tax on their savings
- ability to move the mortgage to a new property, as many times as they like without any product fees
- ability to redraw funds at the same rate throughout the term of the mortgage, back to the original mortgage limit
- minimum loan size is £30,000
- the flexibility to make unlimited overpayments in either lump sums or regular payments
- available for both purchase and remortgage
At the very beginng of 2010 first direct (firstdirect.com) has announced New Year offers on a wide range of banking products including the return of its fee free Base Rate lifetime offset tracker Mortgage. The mortgage tracks the Bank of England Base Rate plus 2.49% making the current rate payable 2.99%.
The offers just announced by first direct are are as follows:
- Fee Free Base Rate offset tracker Mortgage - The mortgage rate tracks the Bank of England Base Rate plus 2.49% making a current rate payable of 2.99%
- Life Insurance - £100 Cashback when taking out first direct Life Insurance
- Cash e-ISA - 2.50% AER (2.47% tax-free) fixed until June 2011 before reverting to first direct standard variable rate, currently 0.20% AER (0.20% tax-free)
- Gold card - 0% on balance transfers for 15 months on transfers made within the first two months of account opening. A Balance Transfer fee of 2.9% (min £5) will be charged for all transfers; typical 16.9% APR variable for the gold card
- Credit Card - 0% on balance transfers for 15months on transfers made within the first two months of account opening. A Balance Transfer fee of 2.9% (min £5) will be charged for all transfers; typical 19.9% APR variable for the Credit Card
- Personal Loan - Those who apply for a Personal Loan with a term of at least 36 months before 31 January 2010 will receive 10% Cashback on interested paid. Typical 8.9% APR for Personal Loans between £5000 and £25000
- Car Insurance - first direct will guarantee to beat written renewal invitations from customers’ current insurer by at least 10%. The bank will also beat any written renewals from the current insurer for second or subsequent cars in the same household by at least 15% (minimum premiums and other conditions apply)
- Home Insurance - Customers receive a 25% discount – equivalent to 3 months free cover when buying a new Home Insurance policy
Source: first direct
