Discount Mortgage

A discount mortgage is a type of mortgage with a interest rate that, for the agreed period of time, will be a certain percentage lower than the standard variable interest rate. The discounted interest rate will fluctuate but the discount will be maintained over the course of any possible fluctuation.

The advantage of discount mortgages is that regardless of market changes you will have a discount as long as the offer is valid.

The disadvantage is that you can be drawn to a lender with a significant discount rate and not realize that he has a high variable standard interest rate and can end up with not such a advantageous deal after all.