With a variable rate mortgage repayments go up and down in line with interest rate fluctuations as defined by LIBOR (London InterBank Offered Rate – the interest rate at which Banks in London lend to each other).
Generally a variable rate mortgage can be a repayment mortgage or an interest only mortgage. The variable mortgage has a rate of interest determined by the lender.
When interest rates change (or when the lender decides) the variable rate will also change. However, if the interest rates change the lender does not have to pass this on to the borrower unlike a tracker mortgage. Our Leicester mortgage brokers can offer the best interest rates country wide.
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