New Mortgage Guides

Other Mortgage Guides

Mortgage Types

Mortgage Tools

Financial Services > Mortgages > Discount Variable Rate Mortgages > Discount Variable Rate Mortgages
Bookmark and Share

A Guide to Discount Variable Rate Mortgage Loans

Discounted variable rate mortgages are loan set at an interest rate discount on a lender's standard variable rate. Typically, discount variable rate mortgages are set for a certain time period, after which interest rates return to the lender's standard variable rate.

How do discount variable rate mortgage loans work?

Discount variable rate mortgages are typically offered at a rate set by the lender. This rate will be a percentage lower than the standard variable rate offered by the lender. Over time, as the standard variable rate increases and decreases, the discounted rate also moves up or down by the same amount.

How long do discounted variable rate mortgages last for?

Generally, discounted variable rate mortgages are offered for a fixed period of time. This is usually two years, but mortgage lenders also offer discounted variable rate mortgages as three or five year deals.

What should I look for in a discounted variable rate mortgage?

Experts advise borrowers looking for cheap discounted rate mortgages that they should look for loans without an extended redemption penalty period. This is known as a 'tie-in', and prevents borrowers from switching their mortgage loan without being charges an early repayment penalty. This type of loan could tie you into paying a lender's standard variable rate for several years.

What are the advantages and disadvantages of a discounted variable rate mortgage?

The major advantage of a discounted variable rate mortgage is that the borrower receives a lower interest rate during the discounted period. However, early redemption penalties and reversion to standard variable rates at the end of the discount period are two obvious disadvantages.

How do I find a discounted variable rate mortgage?

For more information about discounted variable rate mortgage loans and to get a discounted variable rate mortgage loan quote, please use our Mortgage Enquiry Form and one of our experts will contact you for further assistance. Alternatively, you can give us a call on .

Receive Mortgage Advice from a Regulated Advisor

Mortgage advice

There is no better time to be seeking suitable mortgage advice from a Regulated mortgage advisor

Submit your details today for an obligation-free chat and a regulated mortgage advisor will call you back to help you find the mortgage that best fits your needs.

We will only provide your details to one regulated advisor.

Your mortgage

 * Help
 * Help
 * Help
 Help
 Help
 *

About you

 *
 *
 *
 *
 *
 *
 *

Questions marked with * are required

Please be aware that the advisor who contacts you will be a third party advisor who has no connection with us. There is no charge to you for using this service. We are paid by charging your assigned advisor a fee for this service. Any advice or assistance given to you by a third party advisor does not represent our advice or assistance and is not checked or endorsed by us. It is your decision whether or not you act on any advice or assistance you are given.

By clicking “Proceed” you confirm that:

  • You accept our Terms of use and
  • You would like to be contacted by a regulated third party advisor to discuss your needs.

Your home may be repossessed if you do not keep up repayments on your mortgage.

Financial Services Net Limited and other trusted 3rd parties would like to keep you advised via e-mail or telephone of products, services and other exciting offers we think may interest you. Please untick this box if you do not consent to us contacting you for further information.

Bookmark and Share
       
Mortgage lenders
   

Browse mortgage lender offersMortgage Rates by Lender

  • Browse current mortgage offers from over 90 lenders.

Worried about mortgage repayments?Worried about Mortgage Repayments?

  • Join our petition to Government to bail out burdened individuals, not just banks.

Free mortgage quoteFree Mortgage Quote

Mortgages in Scotland Mortgages in Scotland

Equity releaseEquity Release

  • Unlock equity in your home.

Switching mortgagesSwitching Mortgages

Home reversion plansHome Reversion Plans

Commercial mortgages Commercial Mortgages

  • Commercial property loans
  • Starting a business?

Arrears & CCJs?

  • Remortgages
  • Sub prime mortgages
  • Arrears, CCJs
  • Self certification
  • Debt consolidation

Protect your mortgageProtect Your Mortgage

  • 3 months free mortgage protection cover

Mortgage Newsletter