What is a mortgage drop-lock facility ?
August 13th, 2010
What is a mortgage drop-lock facility ?
A mortgage drop-lock facility allows holders of variable rate mortgages, like for instance offset or tracker mortgages, to shift to a fixed mortgage rate, should they wish to in the future, without being charged any penalty.
Currently, variable mortgage rates are very low, but they could be rising in the future, in which case it could prove convenient to drop into a fixed mortgage rate.
Of course, as it is the case on any kind of mortgages, all mortgage conditions and terms must be evaluated properly prior to selecting a mortgage with a drop lock option.
