Low Start Mortgages
In the competitive environment among home lenders there are a variety of offers which promise a discount off the prevailing variable interest rate . In other words, the interest rate on offer is set at a set margin below the standard variable rate.
This 'discount' may be for a number of years, but in some cases lenders have offered big discounts for short periods of time. e.g. 6% off your home loan rate for six months.
These offers are, in a sense 'too good to be true'. They invariably involve the borrower agreeing to stay with the lender for a period of time or face 'withdrawal penalties'.
Other options include mortgages which are : variable rate, fixed rate or capped.