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Intelligent Finance – General Mortgage Information

The following details are general information about Intelligent Finance mortgages. Please note that Intelligent Finance no longer provides the ability for customers to apply for further advances or to change their mortgage deal.

What types of mortgage products are there?

There are different types of mortgage products with different types of interest rates. It is not possible for customers to change their mortgage deal. If you move home, are not increasing your loan and meet our lending policy at the time that you apply, you may be able to take your unexpired special rate with you to a new mortgage.

Tracker Rates

Our tracker rates are linked to the Bank of England base rate administered by the Bank of England, this rate can go up or down which will impact the cost of your mortgage payments.

Type of product How it works Early repayment charges What it means for you
Offset Fixed Rate Mortgages Your interest rate and your monthly payments are set at a certain level for an agreed period (the special rate period). At the end of that period, you will switch to a variable mortgage rate. Early repayment charges usually apply during the fixed rate period.

Sometimes they can apply after the fixed rate period too.
Your interest rate stays the same during the fixed rate period, even if the Bank of England base rate changes.

You won’t benefit if interest rates fall. The interest rate will stay the same.
Offset Tracker Mortgages This is a variable rate loan with an interest rate that is above, below or the same as the Bank of England base rate or some other external rate it tracks for an agreed period (the special period). At the end of that period, you will switch to a variable rate mortgage rate. Early repayment charges usually apply during the tracker rate period.

Sometimes they can apply after the tracker rate period too.
It may benefit you to have a tracker if you can afford to pay more when interest rates rise so that you can benefit when they fall.

A tracker may not be suitable if you live on a tight budget that won’t stretch to higher monthly payments when rates rise.
Intelligent Finance’s offset variable mortgage rate (currently 2.10%)


Intelligent Finance’s standalone variable mortgage rate (currently 2.10%)
A variable rate we set. We decide when and how much to raise or reduce these rates. These rates aren't usually available as a stand-alone product. They are usually a rate we switch you to at the end of your product rate period. Early repayment charges don't usually apply, but check your Illustration or offer letter to be sure. It can pay to stay on a variable rate if you can afford the monthly payments when interest rates rise so that you can benefit when they fall.

Representative Example:

A mortgage of £140,000 payable over 20 years, on our variable rate of 2.10% for 20 years, would require 240 monthly payments of £714.89. The total amount payable would be £171,573.60 made up of the loan amount, plus interest (£31,573.60).

The overall cost for comparison is 2.1% APRC representative.

What happens if I move house?

If you have not come to the end of your special rate period, you can apply to take your unexpired special rate to your new Intelligent Finance Mortgage.

You will only be able to move your special rate to a new loan on a like for like basis (product and loan amount). Your Mortgage Illustration and your offer letter will say if this is the case. You will only be able to take your special rate with you if you can meet our lending policy rules at the time that you apply.

Types of property we will lend against:

The property you buy must be located within the UK. Loans can only be used to buy your main residential home.


If the property is freehold, then you will own the property and the land it’s built on. We don’t lend on freehold flats in England, Wales and Northern Ireland.


If the property is leasehold, then you will own a temporary right to occupy the property and the land it’s built on. The property and the land are owned by someone else and they lease them to you for a number of years. Leases can last for decades or centuries. There is usually an annual charge for the lease, called a ground rent. We’ll only lend on leasehold properties with at least 70 years left on the lease when you apply. Before you buy, your conveyancer will check the lease terms to make sure they are acceptable. In Scotland (except in rare cases where there is a form of long lease known as a ‘tack’) all properties are owned outright by the ‘registered proprietor’.

New build or converted properties

A new property or a property that has been built or converted within the last ten years should be part of a Building Standards indemnity scheme. This gives a ten-year warranty against material defects. There are a number of acceptable schemes, but the main one is run by the National House-Building Council (NHBC). We’ll consider lending on a property that is not part of one of these schemes if it comprises of a development of no more than 15 properties and meets our current monitoring requirements.

Valuation schemes

There are three levels of inspection and report to choose from.

Level 1: Valuation report

This is a very brief report on the property and its market value.

This report is just for our purposes but you will be sent a copy. It’s based on a limited inspection of the readily visible and accessible parts of the property. This will not apply where we use an Automated Valuation Model (AVM).

You should not solely rely on it when making your decision whether or not to purchase the property.

Level 2: Survey and valuation

The survey is for you and we don’t receive a copy. We only receive and make our lending decision on the valuation.

The survey gives guidance on defects and other issues that may affect the property.

The surveyor will send the appropriate terms and conditions for you to read, sign and return.

Level 3: Building survey

Arranged as a contract between you and the surveyor. This is the most detailed survey available to you, which can be tailored to your needs.

You must find your own surveyor to complete this, we do not offer Building Surveys.

If you choose a Level 2 Survey and valuation, our surveyors will send separate terms and conditions that must be signed and returned to the surveyor before the survey can be carried out. These types of survey include a Level 1 valuation report, which will take place at the same time.

We do not offer a Level 3 Building Survey.

What mortgage terms are available?

Mortgage terms of up to 40 years are available; the minimum term we’ll consider is 5 years. The term affects the total cost of the mortgage. If you take out a repayment mortgage, the term also affects the monthly payment. With a repayment mortgage the longer the term, the lower the monthly payment. However, it will take you longer to repay the loan so you will pay more interest. This means it will cost you more over the life of your mortgage. With an interest-only mortgage, the length of the term makes no difference to the monthly payments because these are repaying only the interest charges and not the loan itself. You need to make sure you can repay the loan balance at the end of the mortgage term.

Repaying your mortgage

There are three different ways of repaying your loan. These are repayment, interest-only, and a combination of repayment and interest-only.

Repayment mortgage

Every month, your payments go towards reducing the amount you owe as well as paying off the interest. This means that each month you are paying off a small part of your loan. Your annual statement will show your loan getting smaller. However, in the early years your monthly payments will mainly go towards paying off the interest, so the amount you owe won’t go down much at the start.

Interest-only mortgage

With an interest-only mortgage, your monthly payment pays only the interest charges on your loan – you don’t pay off any of the loan amount. This means your monthly payments will be less than if you had a repayment mortgage. However, the total cost of an interest-only mortgage will be higher because you will be paying interest on the full loan amount throughout the mortgage term. As long as you’ve made all your monthly interest payments, the amount you owe at the end of the mortgage term will usually be the same as the amount you borrowed. So, to repay the loan, you need a lump sum at the end of the term. You are responsible for making sure you have a plan in place to repay this amount.

Combination of repayment and interest-only mortgage

It’s possible to split a mortgage between repayment and interest-only. This means that at the end of the mortgage term you will still have an amount of the mortgage to repay, which you will need to do using a lump sum. You will need to make sure you have a plan to repay this amount at the end of the term. If you comply with the terms and conditions of a repayment loan, the monthly payments which you make will repay the loan in full by the end of the loan term. For interest only loans however, you will need to have a repayment strategy in place to repay the capital when the loan terminates because compliance with the terms and conditions applicable does not ensure repayment of the loan in full.

Annual percentage rate of charge (APRC)

Your Mortgage Illustration will show you the APRC for your mortgage. This is a notional annual interest rate which takes account of fees and charges to reflect the total cost of your mortgage. Your Mortgage Illustration will detail the fees which are included in this calculation. An APRC is calculated using a standard method so it provides an effective way for you to compare quotes from different lenders. The illustration will also show an APRC based on what would happen if interest rates went up to their highest levels over the last 20 years and how much this would impact on your monthly payment.

Other Costs

There are other costs that you should be aware of in purchasing a home that aren’t included in the cost of the mortgage, these could include:

  • Conveyancing fees - Charged by a conveyancer for doing the legal work connected with buying your property. Fees can vary and are often based on the purchase price plus other costs
  • Stamp Duty Land Tax - This is a government tax charged on land and property transactions in the UK. The tax is charged at different rates and has different limits for different types of property and values of transaction.
  • Land Registry fees - The Land Registry or Registers of Scotland will charge for any searches of the property register the conveyancer asks for. It also charges for registering you as the owner and us as the lender. You must pay both these costs.
  • Local authority search fees - The local authority will charge for answering your conveyancer’s questions about the property you want to buy, such as whether the local authority maintains the roads adjoining the property or whether you'll be responsible for this.

Early repayment charges

If you repay part of your loan before the end of an early repayment period you may have to pay an early repayment charge. Your Mortgage Illustration will outline if any early repayment charges are applicable on your mortgage and what period any charge will apply for. The charge would never exceed the maximum shown in your Mortgage Illustration. If you decide to repay your existing Intelligent Finance mortgage early or change to another lender then we will not charge you an early repayment charge, however these charges will be applied if you decide to repay part of your mortgage (we would only apply the fee if it was greater than £10.00.

Once you get your mortgage offer

  • Take time to read your mortgage offer and conditions because they are really important.
  • Ask your conveyancer to explain anything in the mortgage offer and conditions that you don’t understand.
  • Get several quotes for buildings and contents insurance and decide which one you’re going to accept.
  • First payments are taken a month in arrears so we take a full months payment a month after the completion date. We’ll write to you when your mortgage starts to confirm how much the payment is and when we’ll collect it.

If you can’t make your monthly payments

Sometimes circumstances change unexpectedly such as you lose your job. If this happens, it may be difficult for you to meet all your financial commitments and you may need some help for a while. If you find yourself in this situation, you should contact us straight away so we can give you the help you need.

If your monthly payments are up to date but you are worried you may not be able to make some or all of your future payments, you should call us. We may be able to reduce your monthly payments for a while until you get back on your feet. When you call we can discuss the various options available to you. Remember, the sooner you contact us, the greater the chance we’ll be able to find a way to help you.

What happens if I fall behind with my monthly payments?

If you miss your regular monthly payment and we haven’t agreed that you can do so, we’ll write to you. You may also have to pay an arrears charge.

If after reasonable requests you do not pay the amount due, we may also charge you the costs of recovering the money you owe us. We’ll always tell you when we intend to make these charges and how much they will be. There may also be extra legal costs if we have had to get a court order to take possession of your property. You will have to pay these and they can be high.


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