Accord Mortgages has become one of only three UK organisations to launch a US-style LIBOR tracker rate mortgage.
The two lenders who have previously launched such a deal into the market in this country are Skipton and Charcol.
During the tracker period of October 1 2004 to September 30 2009 the interest rate applicable to the Accord mortgage will be set according to where the US$ LIBOR rate stands every year on March 31, June 30, September 30 and December 31. The interest rate charged will be based on the US$ LIBOR rate on these dates plus 1.89%.
The mortgage payments will change to reflect any move in US$ LIBOR one month after the rate is set. The interest rate up to and including September 30 2004 is fixed at 3.19%. The maximum LTV is 95% for properties up to £250,000 while the arrangement fee stands at £495.
Mark Underhill, commercial director at Accord, says: “It's early days yet but demand for the product has been good and it is proving to be just as popular as any of the other products Accord has launched.”