Brunel Independent Mortgages

LIBOR (London Inter Bank Offer Rate) is the rate at which banks lend money to each other. It is typically slightly higher than the Bank of England base rate. It is mostly used for Commercial and Adverse Credit mortgages, with an appropriate loading. It is reviewed quarterly.

There is normally an early repayment charge

The advantage: If interest rates fall, your monthly payment may go down, although this could take three months to come into effect. The same would apply if interest rates increase and this can have a smoothing effect.

The disadvantage: If interest rates rise, your monthly payment may go up. As its reviewed quarterly if interest rates change significantly there can be a big increase (or decrease) in monthly payments.