Frequently asked mortgage questions

We strive to keep our products straightforward and easy to understand and to keep terms and conditions to a minimum. However, there may be questions you want to ask that are not answered elsewhere within our website.

Here we answer some of the more frequently asked questions:

• Do you consider mortgages from outside of the Society's local area?
  • Yes. We offer mortgages for properties in England and Wales (subject to terms and conditions).
• How much can I borrow?
  • Please use the Mortgage Calculators on our website to work out how much we might lend you.
• What sort of things do you lend for?
  • The Society lends for house purchase or remortgages. If you already have a mortgage with the Society, we can also lend additional funds.
• Will I be charged if I repay or redeem my mortgage earlier than the original term?
  • We do not currently have early repayment charges on any of our mortgage products other than our fixed-rate products.A standard Mortgage Exit Fee/Sealing Fee/Administration Fee, currently £150, is payable at redemption of all our mortgages.
• What does APR mean?
  • APR stands for Annual Percentage Rate. A lender is always required to quote the APR when advertising a loan or borrowing rate. It is a standard interest rate calculation designed to reflect the total amount of interest that will be paid over the entire period of the loan. It must also take into account charges which the borrower has to pay in order to obtain the loan and during the loan period (such as lenders fees, valuation and legal fees etc). The purpose of APR is to help you compare the true cost of borrowing.
• What is the difference between an Interest-Only Mortgage and a Repayment Mortgage paying capital and interest?
  • With an Interest-Only Mortgage your monthly payments will only cover the interest on the loan. Your payments will not pay off any of the capital that you have borrowed. You must arrange an adequate Repayment Vehicle (ie, savings plan or other form of investment) to pay off the loan at the end of the term.With a Repayment Mortgage your monthly payment will cover the interest on the loan and gradually pay off the capital you have borrowed. By the end of the agreed term you will have paid off the loan, provided all repayments are made when they fall
• What is the difference between a Standard Variable Rate (SVR) and a Tracker Rate?
  • The SVR is the Variable Rate of interest at which a lender's standard mortgage is set. Although lenders normally change their SVR as a result of The Bank of England Base Rate changing, they are not obliged to change them by the same amount. With a Tracker Rate, the mortgage tracks, by a pre-arranged amount, an independently set interest rate, such as the Bank of England Base Rate for an agreed period. The benefit of a Tracker Mortgage is that you are guaranteed that any falls in interest rates will be passed on to you, usually from the beginning of the month after the rate change. However, any rises in rates are also guaranteed to be passed on to
• What is an Offset Mortgage?
  • Traditional savings accounts are kept separate from your mortgage. If you put them together in a Hinckley and Rugby Offset Mortgage you could save money and reduce the term of your mortgage. Making your savings work even better for you is easy – the amount of your savings is offset against your Mortgage and over the life of your mortgage we only charge you interest on the difference. By offsetting you can avoid paying tax on the interest you would earn on your savings.
• Will offsetting automatically reduce my monthly payments?
  • No, as your savings balance could vary each month your mortgage payments would also have to change each month, making budgeting complex. Because your monthly payments remain the same you are effectively overpaying on your mortgage every single month, reducing your mortgage balance and leading in turn to a reduction in the amount of interest you will be charged over the mortgage term.
• With the Hinckley and Rugby Offset Savings account do you offer on-line banking facilities?
  • No, it does not offer on-line banking facilities but it is still quick and easy to gain access to your savings and to arrange telephone BACS transfers from your savings account directly into your bank account, without charges.
• Can existing Hinckley and Rugby borrowers switch mortgage products?
  • Existing borrowers with the Society can switch to any of the Society’s current mortgage products. Details of our current mortgage products are shown on this website or you can telephone 01455 894053 or 01455 894058 for further details.
• Can I change the due date for my mortgage repayments?
  • You can choose the Direct Debit payment date from one of the following monthly options: - 8th, 15th, 22nd or the last banking day.
• How can I protect myself against fraud?
  • Advice on how to protect yourself against all kinds of fraud is available in a special leaflet "Keep clear of fraud" published by the National Fraud Strategic Authority. To view the leaflet, please visit http://www.moneymadeclear.fsa.gov.uk/pdfs/keep_clear_of_fraud.pdf.