Principality's interest only mortgage rates are cut.
Despite the market wide tightening of interest only mortgage criteria, Principality has decided to introduce a rate cut to its products.
With fewer interest only mortgage deals available offers have become difficult to achieve. Many lenders have restricted both criteria and availability, and some have withdrawn from the market completely.
In previous years interest only mortgages were popular as monthly repayments were lower than those of fixed rate mortgages. Interest only proved popular with many first time buyers which helped them to climb up onto the property ladder.
However since December's Mortgage Market Review, some lenders have been moving away from offering interest only and others have increased their rates.
Earlier in the year Principality did restrict its interest only mortgage range. Previously the lender offered an interest only option range wide, however following in the footsteps of other lenders it reduced its offering to just 3 products.
With funding costs having fallen Principality has decided to introduce a rate cut. For an interest only mortgage for 50% LTV a rate of 3.39% is offered, for 75% LTV a rate of 3.99% is offered and for 85% LTV a rate of 4.49% is offered.
If you want to compare the most competitive interest only mortgage deals call Deal Direct.
Contact one of our advisers today.
