Interest

If you have the Standard Variable Mortgage Rate
We may change the rate at any time. This will usually be because general interest rates have changed or to reflect market conditions. But even then, the rate will never be more than 2% above the Bank of England base rate.

If you have a Discount Mortgage
The discount is off the Standard Variable Mortgage Rate, so the discounted rate will follow any changes to that rate.

If you have a Tracker Mortgage or Lloyds TSB Offset
During the tracker period we will vary the rate only if the Bank of England base rate changes. Your rate will change within one month.

If you have a Fixed-Rate Mortgage
The interest rate will not change throughout the fixed-rate period.

If you have a Capped-Rate Mortgage
The rate can change during the capped-rate period, but only when the Standard Variable Mortgage Rate is lower than your capped rate. When it is, you pay the Standard Variable Mortgage Rate. When the Standard Variable Mortgage Rate is above the cap, your mortgage rate remains at the cap.

• write to you with details of the new rate, or
• advertise the change in at least two national newspapers,
• and, if we advertise, notices will also be displayed in C&G and Lloyds TSB branches, giving all the details.

If you are coming to the end of a discount, tracker, fixed or capped-rate period, we will normally write to remind you and to give you details of any payment change.

If you’re already a C&G mortgage customer and are moving home or borrowing more with a Homeowner Loan, it may be that, currently, interest on your existing mortgage is calculated annually. If this is the case, we will change it to daily interest when your new mortgage or loan starts so that interest on your whole mortgage will then be calculated daily.

Even if you’re not moving or borrowing more, if your interest is calculated annually, you can ask us to calculate it on a daily basis instead.

Applied rate for the term of the mortgage 5.19%.

The overall cost for comparison is 6.2% APR

The applied rate is the actual rate used to calculate the interest due on a loan, i.e. it's the rate you pay.

So, in the example above, the actual interest rate charged is 5.19%. Depending on what type of mortgage you have, this rate could change. See the previous section, 'Rate changes', for more information about this. The interest due is usually payable monthly.

The APR (annual percentage rate) is intended to help you compare the true overall cost of loans offered by different lenders – so it takes into account not only the applied rate, but any costs such as product, valuation and administration fees, the term of the loan and whether it is on an interest only or repayment basis. This means that two mortgages could have the same applied rate and the same mortgage term, but if one had more charges for example, then the APRs could be different. You will always see an APR quoted alongside the applied rate in any mortgage advertising. The APR quoted is expected to represent the APR at or below which at least two thirds of the target audience will be charged.