This is ideal for first time buyers who would like to pay a low premium for a period of time. The period is not long but enough for the home buyers to get on top of their finances. The mortgage guarantees that you pay a discounted rate which is below the lenders standard variable rate, although this is for a limited time period it is an ideal mortgage if you wanted to get on the property ladder.

The length of the discount given can vary from lender to lender, it can be from six months to five years. The shorter the discount period is the higher the discount levels are, the longer the time period is the lower the discount is. Some lender may offer you a different package which might have both a high level of discount for the first year which then later decreases as time goes on. This is something each individual must evaluate from their financial situation.

You can change mortgages but there may be redemption penalties which you would have to pay if you change during the discount period, you can find this out by referring to your mortgage policy. You may still want to wait until the discounted period is over before moving to another mortgage lender, you might even eligible to get another discount mortgage which will give you further savings.

Once the discounted period is over you have to pay the normal standard variable base rate set by the bank of England.