Egg launches new 2 and 3 year fixed-rate mortgages

Egg, the online bank and award winning mortgage lender, has launched a 2 and a 3 year fixed-rate mortgage with a highly competitive rate of 5.89%.

At the end of the fixed term, borrowers will switch to Egg’s standard variable rate, currently 6.94%, for the remainder of the term.

Two year fixed: The overall cost for comparison is 7.1% APR.

Three year fixed: The overall cost for comparison is 7.0% APR.

The new mortgages, which are open to all new and existing customers, are available from 24 September 2007 and come with a free initial valuation. The mortgages have an arrangement fee of £899 for the two year fixed rate and £749 for the three year fixed rate and are available for loans up to a maximum of 95% of the property value.

Stephen Bright, Head of Lending and Insurance at Egg, said: “A fixed rate mortgage offers customers certainty allowing them to protect themselves from turmoil in the financial markets. It’s why we’ve launched a competitive, great value product with fixed repayment costs and protection from any further changes in interest rates over the next two or three years. These new fixed rate products complement our existing range of popular variable rate, flexible and offset mortgages.”

The main features of the two year fixed rate mortgage include:

Rate of 5.89% fixed for two years
thereafter changing to Egg’s standard variable rate, currently 6.94%, for the remaining term of the mortgage
The overall cost for comparison is 7.1% APR
Early repayment charges - 2% of the amount repaid during the first 12 months following completion. 1% of the amount repaid during the second 12 months following completion. Thereafter, no charge
Arrangement fee of £899 which will be added to your mortgage

The main features of the three year fixed rate mortgage include:

Rate of 5.89% fixed for three years
thereafter changing to Egg’s standard variable rate, currently 6.94%, for the remaining term of the mortgage
The overall cost for comparison is 7.0% APR
Early repayment charges - 3% of the amount repaid during the first 12 months following completion. 2% of the amount repaid during the second 12 months following completion. 1% of the amount repaid during the third 12 months following completion. Thereafter, no charge
Arrangement fee of £749 which will be added to your mortgage

Both products have:

Flexibility: the ability to overpay by up to 10% per year during the fixed rate period without charges and take payment holidays
Saving on costs: Egg will pay customers’ initial valuation fee.
Security: protect against potential interest rate rises with fixed payments
No higher lending charge

For further information on Egg’s range of mortgages, visit egg.com/mortgages