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The account rewards you with fixed annual interest of 3.00% Gross*/AER** until 31.05.2014, followed by a guaranteed 1.00% above Bank of England Base Rate (currently 0.50%) until the end of the month following the release of the charge over the savings account. |
How the account works
There is a charge placed over the savings in the Family Deposit Mortgage-Savings Account. This means that in the event of the borrower failing to make repayments on the mortgage and the property being repossessed and sold for an amount less than the sum owed on the mortgage, some or all of your savings will be used to cover the loss to the Society. Any funds remaining will be available for withdrawal. No withdrawals are permitted until the charge over your savings account is released, usually after 5 years.
Is this account suitable for me?
This account is suitable for customers under 65 who are supporting a family member purchasing a property with our Family Deposit Mortgage, and are happy for their savings to be placed under a charge. They must also be able to keep the money in the account for a set period, normally 5 years, without access.
When does the charge over the account get released?
The charge over your Family Deposit Mortgage-Savings Account will be withdrawn and your money can be accessed in full when the earliest of the following applies:
- On the date of the fifth anniversary of completion of the mortgage, providing there has been no mortgage arrears in the 2 years before this.
- Where the amount owed on the mortgage is less than 75% of the property valuation, providing there has been no mortgage arrears in the 2 years prior to this.
- On full repayment of the mortgage.
- On death of the saver(s).
- If the mortgage does not proceed.
How much can I invest?
The minimum investment must be equivalent to 25% of the value of the property being purchased by the borrower, less the amount of their deposit. Once the account has been opened with the correct sum, no further investments are permitted.
How much interest can I earn?
The interest rate is fixed at 3.00% Gross*/AER** until 31.05.2014 followed by a guaranteed 1.00% above Bank of England Base Rate until the end of the month following the release of the charge over the savings account.
How and when is interest paid?
Interest will be paid annually at the close of business on 31 May. The interest can be added to your account, transferred to selected variable rate Society investment accounts or direct to a nominated bank account. Once added to the account, interest becomes subject to the same withdrawal conditions as the capital.
When does my account mature?
There is no maturity date for the Family Deposit Mortgage-Savings Account, but your savings will become available for withdrawal once the charge over the account has been released. If the savings account is opened but the mortgage never completes, the savings account will be closed and the funds and interest returned to you without penalty and without notice being required.
Do I have access to my money?
No withdrawals are permitted until the charge over your savings account is released. You are committing these funds to the Society normally for at least 5 years. When the charge over the savings account has been released the interest rate and terms on the account will change to the Society’s Instant Access Savings Account. We will write to you when releasing the charge and invite you to consider other Society savings account options. You may view your Family Deposit Mortgage-Savings Account online; simply register for You-View, our online account service. Other Information
How can I open an account?The Family Deposit Mortgage-Savings Account can only be opened as part of a Family Deposit Mortgage application. For application forms and an information pack please call our Mortgage & Insurance team on 01858 412610.
The Saver must seek legal advice (this will be a condition of the mortgage offer, please see Family Deposit Mortgage - Charge Over Savings Account Legal Contract on the Mortgage Terms & Conditions page for more information) and savings funds must be received by the Society and cleared at least 14 days before the mortgage completes.
Please send your signed application form, together with your personal cheque(s) and evidence of identification to:Market Harborough Building Society, Welland House, The Square, Market Harborough, Leicestershire, LE16 7PDIf you have any questions or would like to talk through any of our mortgage products, please contact our Mortgage team on 01858 412610 - they will be happy to help.*Interest will be paid or credited after deduction of income tax at the lower rate, currently 20%, or subject to the required certification, gross.
**AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest paid and added once each year.
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| Product information is also available in Braille, Large Print and Audio format. |
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This product may be withdrawn at any time and without notice. |
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| Issue Date: 15 May 2012 |
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