Norwich Union & Royal Bank of Scotland offer discounted 100% mortgage with no MIG charge

Article date: 2 April 2001

Norwich Union is pleased to announce its latest mortgage offer.IFAs can now access a 100% mortgage with a two-year discount and nomortgage indemnity guarantee (MIG) charge.

The mortgage is offered in association with The Royal Bank ofScotland and is in response to feedback from IFAs who wish to havemore choice of products at 100% with no MIG charge. The additionalbenefits of a discounted rate of 1.25% for two years plus, theability to add legal and valuation fees to the loan to a maximum of£1000* are also available.

Jon Round, Norwich Union's Head of Mortgage Development,commented: "Our latest offer will enable IFAs to save their clientsthousands of pounds if they're looking for a 100% mortgage, as MIGcan be very expensive over 95% LTV. In addition they can takeadvantage of savings on an initial discounted rate for twoyears."

IFAs will benefit from procuration fees of 0.45% for loansbetween £25,000 and £75,000 and 0.55% for loans over £75,000 up toa maximum of £1,500.

Further information on this product or any other mortgageproducts is available to IFAs by calling 0845 845 1388.

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* Legal and valuation fees will be added at 100% LTV.

The offer in detail:

  • Maximum loan to value - 100%
  • Available to: first time buyers, subsequent purchasers andremortgages throughout England and Wales
  • Interest rate set at 1.25% discount relating to The Royal Bankof Scotland 100% variable mortgage rate until 1st May 2003(initial rate currently 6.74% - 8.4% APR). Thereafter it convertsback to The Royal Bank of Scotland's 100% variable mortgage rate(currently 7.99%).
  • Incentives: legal and valuation fees can be added to the loansubject to the maximum loan to value. (A maximum of £1000 can beadded over 100% loan to value). Valuation fee must be paid onapplication but, will be refunded on completion and the amountadded to the loan.
  • Repayment types accepted: capital & interest, endowment,pension and Isa
  • Minimum loan - £40,000 Maximum loan - £150,000
  • Income multiples: 3.25 x applicant's income plus 1 x jointapplicant's income. Alternatively 2.75 x joint income can beconsidered.
  • Early repayment fee: 2% of amount redeemed until 1st May 2004.No partial redemptions allowed.
  • Arrangement fee - £295 (can be added to loan on request).

Typical Example: 6.74% (1.25% discount until 1st May 2003). TheAPR of 8.4% variable is based on the following assumptions: a£60,000 capital repayment mortgage on a property valued at £60,000repaid over 25 years. 25 gross monthly repayments of £414.17assuming a rate of 6.74% followed by 275 payments of £459.90assuming the rate reverts to the 100% variable mortgage rate of7.99%. In this example , the total amount payable would be£140,299.75. This includes £80,299.75 total gross interest payable,£650 legal fees, £200 valuation fee, and £75 selling/deeds releasefee. A completion date of 1st March 2001 is assumed. The propertyupon which the loan is required to be secured must be insured forthe cost replacement value. This example does not constitute aquotation or contract. Full written details, including a quotationare available on request. All loans are subject to status andsatisfactory valuation. Loans are not available for persons under18 years of age.

YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP REPAYMENTS ON AMORTGAGE OR OTHER LOAN SECURED ON IT.

Notes to editors:

1. IFAs can benefit from the buying power of one of the largestmortgage intermediaries in the UK, through enhanced mortgageproducts, enhanced procuration fees - with dedicated service andsupport.

2. Norwich Union is the UK's life and general insurance tradingbrand of holding company, CGNU plc, which was created from themerger between CGU and Norwich Union on 30 May 2000.

3. Norwich Union is the UK's largest life and pensions company(based on 2000 new premium income).

Press office contacts

James Evans - Tel: 08703 66 68 78
Louisa Steel - Tel: 08703 66 68 71
Out of hours - Tel: 07790 487105

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