Please Explain 'Borrowers Rate'

pennypincher1010

Hi There

I am looking at a Natwest 2 year fixed rate mortage and dont fully understand the terms and conditions. I would be grateful if someone could explain the meaning of 'borrower's rate' to me!?

The clause I don't get:

'3.44% Fixed to 31/05/2011; Reverting to an Existing Borrowers Rate of 4.00% for the remaining term of the mortgage;'

Does this mean that if I had a 25 yr term mortgage, the first 2 years would be at 3.44%, then the remaining 23 yrs at 4%? I'm sure this can't be the case, as it sound to good to be true. This 'borrower's rate', surely must be variable?

Thanks in advance for any advice....

:beer:

Saver-Rob

Normally, as far as I know, after your fixed rate term has expired you revert to the lenders Standard Variable Rate, which in this case is currently 4% though could (and no doubt will) change over the next 2 years.

You may well choose to fix again after the 2 year period though.