Loans must be secured by a first mortgage on a suitable property
in England or Wales. We will lend on houses, leasehold flats and maisonettes,
(purposebuilt or converted). For leasehold premises, the lease must have
at least 35 years to run after the mortgage expiry date.
Lambeth
Building Society Repayment Mortgages
the monthly payments consist of capital and interest to repay
the loan over the life of the mortgage ( the mortgage term). A term life assurance
policy is recommended with this type of loan. the balance outstanding on the loan reduces each year.
Lambeth
Building Society Interest
Only Mortgages
For Interest Only mortgages you are responsible for repaying
your mortgage in full at the end of the term. You are also responsible for
monitoring the progress your investment is making to ensure that the proceeds
of the policy on maturity will be adequate to repay your loan. You must make
sure that your payments are kept up to date. You should be aware that if your
investment does not perform well, or if you stop making your payments, or
if you surrender your investment early, or should your personal circumstances
change (for instance due to illness or relationship breakdown) the investment
may not be sufficient to repay the mortgage. If this happens, you will have
to repay the difference from othe r means.
Lambeth
Building Society Endowment
Mortgages
the borrower pays the Society interest on the loan. the monthly
payments made do not include any capital and the refore the y do not reduce
the balance of the loan. the borrower deposits a suitable life assurance policy
with the Society and pays monthly premiums to the insurance company.
Under normal circumstances, at the end of the mortgage term,
the proceeds of the life policy are used to repay the balance outstanding
on the loan, although this is not guaranteed.
the borrower obtains the benefit of life assurance cover,
which will ensure that the mortgage is paid off in the event of death, and
the borrower might also receive a lump sum at the end of the mortgage term.
Lambeth
Building Society PensionLinked
Mortgages
A method of repaying a mortgage by means of the taxfree cash
sum available at retirement. It operates like an endowment mortgage in that
only interest is paid to the Society during the mortgage term.
the capital is repaid at the end of the mortgage term, using
part of the proceeds from a pension plan. the advantage of a PensionLinked
Mortgage is that, under current legislation, tax relief at the borrower's
highest rate is obtained on premiums.
Lambeth
Building Society ISA
Mortgages
the proceeds of an Individual Savings Account (ISA) are used
to repay the capital at the end of the mortgage term.
For a mortgage linked to an Individual Savings Account (ISA),
applicants should be aware that the y are not guaranteed to run beyond 2009
and that tax relief on dividends is only due to be received up to 2004. In
the event that the ISA facility is terminated the Applicant will have to put
in place an alternative repayment method to ensure that the capital borrowed
is repaid at the end of the mortgage term. Your Financial Adviser should have
already discussed the se issues with you.
Interest Rate alternatives
Lambeth
Building Society Variable
Rate
With a variable rate mortgage as interest rates go up or down,
so does the amount you are due to pay. Unless you have chosen to change your
monthly payments it will alter annually on our Annual Review Scheme. Generally
this type of mortgage is the simplest. the rate may vary in accordance with
the lender's policy (known as a "standard variable rate") or by
reference to anothe r index, such as bank base rate (known as a "tracker").
Discounted Rate
A discounted rate mortgage offers a discount off the variable
rate, usually in the first few years of the mortgage. You may have to pay
an early redemption fee if you repay part or all of your mortgage or transfer
to anothe r product offer.
Fixed Rate
With a fixed rate mortgage, no matter what happens to the variable rate, your interest rate will stay the same for a set period. This
means you'll know exactly what you have to pay if you are looking for certainty
when budgeting. If general interest rates fall, yours won't so you could
find yourself paying more than you would with a variable rate mortgage. When
the fixed rate period ends your monthly payments will change as your mortgage
reverts to a variable rate.
Capped Rate
Capped rates provide you with an assurance that for a set
period the variable rate of interest charged on your account will not go over
a percentage which is agreed at the start of your mortgage. When the capped
rate period ends your monthly payments will change as your mortgage reverts
to a variable rate.
Flexible
With a flexible product you have the option to make overpayments
or take payment holidays (after the initial six months). This gives you more
control over how you manage you mortgage commitment. Interest payable can
be linked to a discount, tracker or fixed rate product.
Interest
Interest will be calculated on the amount of your mortgage
advance to the following 31st January and the reafter on the balance outstanding
at 1st February each year.
Except for any period where a fixedrate applies, the Society may vary the interest rate at any time and changes will normally be advertised in the national
press. If you have taken a flexible mortgage with the Society the interest
will be calculated daily and the balance owing will be adjusted accordingly.
Monthly Payments
Your monthly payments will be reviewed annually. A statement
will be sent to you showing the effect of any interest rate changes and the new payment required to repay the loan within the original term of the mortgage.
Early Repayment
If, in addition to making your normal payments, you repay
an additional £500 or more, we will immediately reduce the mortgage
balance on which you are paying interest, the refore reducing the actual amount
of interest you pay. the re may be a charge on some mortgage products if such
a payment is made, please refer to the individual product sheets for details.
Property Valuation
We require the property to be valued and you must pay for
this. We only use valuers nominated by the Society. the valuation report is
solely for our use in deciding the amount, if any, we will lend. A copy of
the report will be given to you if an Offer of Advance is made.
Only a full structural survey is likely to reveal any defects
in the property. Unless you have such a survey, you may be unaware of any
defects or othe r matters adversely affecting the property you are intending
to purchase and for which you will be financially responsible.
Should you wish to obtain a more detailed survey, please indicate
this on your mortgage application form. If you use the valuer nominated by
the Society, you will save costs, as both can be carried out during one visit.
We will ask the valuer to contact you to discuss your requirements and you
will be invoiced direct, by the valuer, for the survey.
If you instruct a surveyor or a valuer without consulting
us first, we cannot be held responsible if the firm or person you choose is
not acceptable to the Society for property valuation purposes.
Higher Lending Charge
Where the mortgage advance is in excess of 75% of the purchase
price or valuation of the property (whichever is the lower figure), the Society
charges a Higher Lending Charge.
the fee is used by the Society to protect itself (not you),
should you default on the mortgage and the Society be unable to recover the debt in full. However, any outstanding debt still remains your responsibility.
Depending upon the circumstances, the Society may arrange
with external insurers to cover its risk, but you do not obtain any insurance
cover. the Higher Lending Charge is paid by you eithe r as a single payment
at completion of the mortgage or as part of the monthly mortgage payment.
the fee is nonrefundable.
You should be aware that if we take out such insurance, and
we make a successful claim under that policy, the insurance company will have
the right to pursue you for the shortfall covered by that insurance.
Buildings and Contents Insurance
You are required to hold a current buildings insurance policy
to protect any property that is mortgaged with the Society. It is your responsibility
to take out a suitable insurance policy with a reputable insurance company
for an amount at least equal to that set out in our offer.
the Society offers a competitive insurance policy that will
meet with the se requirements. We can offer you an insurance policy that will
cover both your property and its contents, if required. Full details can be
explained to you by one of our mortgage advisers, with literature available
on request.
Accident Sickness and Unemployment Insurance
the Society offers a competitive insurance policy that will
ensure that in the event of accident, sickness or unemployment your mortgage
payments will be met for a specific period of time. Full details can be explained
to you by one of our mortgage advisers, with literature available on request.
As a mortgage is a longterm commitment, you should consider
how you protect yourself and your family should you be unable to make your
monthly payments. Accident sickness and unemployment insurance is recommended
to all our borrowers.
Life Assurance
You may already have Life Assurance as part of an endowment
policy. However, if you do not have enough life assurance to repay your loan
upon death, please contact one of our mortgage advisers who can explain the options that are available to you.
General Insurance Standards Council
the Society is a member of the General Insurance Standards
Council (GISC). GISC regulates sales, advisory and service standards, to make
sure that general insurance customers are treated fairly.
Fees and Charges
You will have to pay some costs, fees or charges when you
are applying for a mortgage. Our product guide sets out the fees applicable,
Brief details of the usual fees are set out here:
Application fees: You may be required to pay an application
fee which covers the cost of processing your application.
Valuation Fees: You may be required to pay a fee which covers the cost of
instructing a valuer and our costs in dealing with his report. the product
guides will tell you how much.
Product fees: some applicants must pay a fee to secure a particular product
type. This fee is normally charged to obtain specific interest rates offered,
e.g. a fixed rate, limited offers, etc. Again, the product guides will tell
you how much.
CHAPS fee: we charge a fee to cover the costs of transferring the mortgage
advance electronically to solicitors.
Solicitor's fees: your solicitor will charge you a fee for the legal work
he does on your behalf, whethe r you are remortgaging or moving house. He will
also charge you any out of pocket expenses (called "disbursements")
that he pays out on your behalf. Your solicitor may be asked to act for us
as well and his fee quoted to you should include his charges for this work
as well. Where your solicitor is not appointed to act for us, we will advise
you of the appropriate fee.
Once you have completed your mortgage, the re may be othe r
fees that you will be asked to pay. the se cover the cost of providing any
services you request (such as furthe r advances, transfers of equity, providing
title information, etc); as well as charges we make regarding the conduct
of your account (such as unpaid direct debits, etc) and costs associated with
paying off your loan during any initial period.
Portability
If you move home within any initial discount or fixed rate
period, you may be able to take your mortgage with you. You should ask us
for furthe r details.
Your Information
You should be aware that we do pass information about you
to credit reference agencies. As part of your application, we send your name
and address to a credit reference agency in order to retrieve credit information
about you and those with whom you may be linked financially or othe r members
of your household. the result of this credit search is used as part of our
decision to lend. We do seek your consent prior to the search being undertaken.
It is also our standard practice to pass details of the conduct
of your account to credit reference agencies should you stop making your mortgage
payments in full. This information may be shared with othe r lenders and used
for credit assessment and debt tracing. We only do this when you have missed
two payments and we will tell you in advance that we are going to do this.
