Accord Mortgages has launched a range of standard variable rate (SVR) mortgages and removed early repayment charges, following feedback from brokers.
The lender has responded to brokers’ concerns that customers may often avoid mortgages linked to a lenders SVR because the SVR can be adjusted at any time, despite this potentially being a more cost-effective option.
The majority of new mortgages are available to both house purchase and remortgage customers, with rates starting at 1.09% for a 2-year discounted SVR for borrowers requiring 60% loan-to-value (LTV). This mortgage comes with a £1,495 fee.
The mortgages are designed to give borrowers flexibility as they can redeem their mortgage or transfer it to a fixed rate should they wish, at any time during the discounted period without penalty. All of Accord’s discounted SVR mortgages also allow unlimited overpayments.
Dan White, managing director at White Financial Services, said: “I think it’s quite a positive move, having more flexibility with products definitely helps borrowers especially in a market not sure whether interest rates will increase.”
For those with a 35% deposit, a 2-year discounted SVR mortgage is available at 1.29%, which comes with free standard valuation and a lower fee of £495.
Ben Merritt, mortgage manager at Accord, said: “We’re committed to listening to and acting on feedback from brokers and this new range of mortgages illustrates just that.
“Our entire discounted SVR range is now ERC-free, giving customers the chance to benefit from lower rates and monthly repayments but with the option of switching to a fixed rate or redeeming the mortgage with no charge, should they wish at any point.
“Over the past few months we’ve seen a lot of demand for discounted SVR mortgages, perhaps because the low rates mean customers could potentially withstand a number of rate increases before it would have been better to have opted for a fixed rate.
“We’re confident the introduction of these new and enhanced mortgages will be welcomed by both brokers and customers – for the right case, discounted SVRs could be a great alternative.”
Borrowers with smaller deposits may be interested in a 2-year discounted rate of 1.74% at 90% LTV, or 2.99% at 95% LTV. Both mortgages have a £495 fee and free standard valuation, though the 5% deposit mortgage is only available to house purchase customers.