Armed Forces Mortgages
Mortgage rates from just 4.50% (variable), with the people-first approach you’d expect from your credit union.
All Mortgages are subject to our Lending Policy and Terms & Conditions. Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
Buying a home?
With us, it’s personal.
As a credit union, we understand that it’s not just a property you’re buying—it’s your home. That’s why unlike larger lenders, we take a personalised approach, from the moment we receive your initial enquiry to the day you move in.
We give you a named mortgage advisor, will work with you to understand your needs and help you navigate the process of buying your home. We also underwrite all our mortgages manually, allowing our team to reach a decision based on your full circumstances, rather than a knee-jerk ‘yes’ or ‘no’.
Answer some quick questions to check if you meet our basic criteria, with the option to get started on obtaining a Decision in Principle:
Mortgages Overview
See the key features of the mortgages we offer, and whether we are likely to be right for you.
Application Process
Learn more about the process of applying for a mortgage with us, and what’s involved.
Mortgage Rates & Products
Get a full breakdown of our mortgage rates, fees and all other charges.
Important
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage. Mortgages are subject to underwriting and criteria. Minimum age 18, UK residents only.
Key Features
Get an idea of whether a mortgage with us meets your requirements. For specific details of our mortgage products and their fees, check out our products.
- Discounted rates from 4.50%, based on LTV
Two and three-year discounted periods available.
Our standard variable rate (‘revert to’ rate) is 7.49% - Maximum loan of up to £350,000
This is in addition to your deposit or any equity you have already have in the property. - Forces Help to Buy
We are happy to be able to accept a Forces Help to Buy (FHtB) loan provided by the MOD as part of your deposit. - Maximum 80% loan to value (LTV)
We can lend up to 80% of the property’s value. - First-time buyers and remortgages
The property being mortgaged must be your main home. - Up to four applicants
You can apply jointly with up to 3 other adults (UK residents only). - Residential properties only
We don’t lend for business premises or buy-to-let.
Understanding Mortgage Types
At London Mutual, we offer variable rate and discounted period mortgages. Before applying, make sure you understand the different types and which could be right for you.
Variable
With variable interest rates, the rate can change at any time. Make sure you have some savings set aside so that you can afford an increase in your payments if rates do rise.
Our rates are linked to Standard Variable rate which is a variable mortgage rate set by the Credit Union. We have several discounted products linked to Standard Variable Rate for different terms and loan to values.
Source: Money and Pensions Service
Discounted Period
Your mortgage will start on a lower (discounted) rate for a certain period of time. How long this lasts depends on the mortgage product. At London Mutual, we offer mortgage products with two or three-year discounted periods.
After the discount period ends, the mortgage will move to a variable rate, known as the ‘revert to’ rate.
Fixed
The interest rate you pay will stay the same throughout the length of the deal, no matter what happens to interest rates in the market.
You’ll see them advertised as ‘two-year fix’ or ‘five-year fix’, for example, along with the interest rate charged for that period.
When this period ends, you’ll move onto a standard variable rate (SVR), unless you remortgage.
London Mutual Credit Union does not currently offer this type of mortgage.
Source: Money and Pensions Service
Tracker
Tracker rates move directly in line with another interest rate – normally the Bank of England’s base rate plus a few percent.
So if the base rate goes up by 0.5%, your rate will go up by the same amount.
They usually have a short life, typically two to five years. Although some lenders offer trackers which last for the life of your mortgage or until you switch to another deal.
London Mutual Credit Union does not currently offer this type of mortgage.
Source: Money and Pensions Service
Forces Help to Buy
Borrow up to 50% of your armed forces salary (up to a maximum of £25,000) interest-free towards the purchase of your home.
London Mutual Credit Union is proud to be able to work with service personnel who wish to take part in the Ministry of Defence Forces Help to Buy (FHtB) scheme. Under this scheme, service personnel can obtain an interest-free loan of up to 50% of their annual salary, towards the purchase of a home.
You can find out more about the scheme and apply via JPA. When applying for a mortgage with us, simply let us know you’re intending to take advantage of the scheme during your initial call with our Mortgage Advisors. Once your FHtB loan is approved, we’ll ask to see your letter confirming this. We’ll then be able to consider the Forces Help to Buy loan as part of your mortgage deposit.
The Credit Union Difference
Whether you’re buying your first home or are an existing homeowner looking for a better deal, we aim to do things differently.
As a credit union, we are mutually-owned, and exist to serve the needs of our members. Since 1982 we’ve been doing exactly that, with savings, loans and current accounts built around the needs of our community.
In 2022, we became the first UK credit union in 25 years to be authorised to offer mortgages. We aim to bring the same ‘people-first’ approach that we’ve been known for, to the process of buying your home.
Answer some quick questions to check if you meet our basic criteria, with the option to get started on obtaining a Decision in Principle:
Salary Deduction
We work with major employers including the NHS and Ministry of Defence to offer a salary deduction service, giving you the option to have repayments deducted directly from your salary without worry or fuss.
Agency Income
When assessing affordability, we can take into consideration any agency or fixed-term income you receive on a regular basis - for example NHS bank hours or agency work.
Up to Four Applicants
As a credit union, we believe in the power of working together. That's why we can consider joint applications from up to four applicants, as long as you each are individually eligible to join.
People-First
Get a personalised offer that's right for you from one of our fully-qualified Mortgage Advisors. And if you ever have a question or need to speak to someone, our UK-based team is available by phone or email.
Application Process
What to expect when applying for a mortgage with us.
Our Mortgages
You can find full details of our individual mortgage products below. As part of the application process, a qualified Mortgage Advisor will discuss your needs and make a recommendation of which (if any) of our mortgages are suitable.
Discounted (60-80% LTV)
Who’s Eligible
This product is available if the mortgage is for between 60% and 80% of the valuation or purchase price, whichever is lower.
(For example, you must have a deposit or existing equity in the property of at least 20%.)
What it Will Cost
- For the first 2 or 3 years you’ll pay a discounted rate, currently 4.74%.
- Your rate will change throughout your mortgage period, so your repayments may go up or down.
- After the discounted period ends, you will revert to our standard variable rate (SVR) product, which is currently 7.49%.
- A ‘floor’ means the rate you pay will not fall below 2.50%
Other Fees or Charges
- If you move house or pay off your mortgage in full early, you’ll have to pay a 2% early repayment fee (ERC).
- You can overpay up to 20% each year during the discounted period without incurring the early repayment fee.
- There are no arrangement fees
See Mortgages Tariff for a comprehensive list of all applicable fees
Summary
| Period | Discounted Rate | Reverts to | Arrangement Fee | Early Repayment Fee | Min Loan | Max Loan | Max LTV |
|---|---|---|---|---|---|---|---|
| 2 Year Discount | 4.74% 2.5% Floor | 7.49% | Nil | 2.00% | £20,000 | £350,000 | 80% |
| 3 Year Discount | 4.74% 2.5% Floor | 7.49% | Nil | 2.00% | £20,000 | £350,000 | 80% |
Discounted (<60 LTV)
Who’s Eligible
This product is available if the mortgage is for less than 60% of the valuation or purchase price, whichever is lower.
For example, you must have a deposit or existing equity in the property of at least 40%).
What it Will Cost
- For the first 2 or 3 years you’ll pay a discounted rate, currently 4.50%.
- After the discounted period ends, you will revert to our standard variable rate (SVR), which is currently 7.49%.
- Your rate will change throughout your mortgage period, so your repayments may go up or down.
- A ‘floor’ means the rate you pay will not fall below 2.50%
Other Fees or Charges
- If you move house or pay off your mortgage in full early, you’ll have to pay a 2% early repayment fee (ERC).
- You can overpay up to 20% each year during the discounted period without incurring the early repayment fee.
- There are no arrangement fees
See Mortgages Tariff for a comprehensive list of all applicable fees
Summary
| Discounted Rate | Reverts to | Arrangement Fee | Early Repayment Fee | Min Loan | Max Loan | Max LTV | |
|---|---|---|---|---|---|---|---|
| 2 Year Discount | 4.50% 2.5% Floor | 7.49% | Nil | 2% | £20,000 | £350,000 | 60% |
| 3 Year Discount | 4.50% 2.5% Floor | 7.49% | Nil | 2% | £20,000 | £350,000 | 60% |
Standard Variable Rate
- You’ll stay on this product for the lifetime of the mortgage, with no discounted period
- The rate itself (currently 7.49%) will change, so your repayments will go up or down.
- No arrangement fees or early repayment charges
Fees & Charges
| Rate | Arrangement Fee | Early Repayment Fee | Min Loan | Max Loan | Max LTV | Revert to Rate |
|---|---|---|---|---|---|---|
| 7.49% | Nil | Nil | £20,000 | £350,000 | 80.00% | 7.49% |
Understanding Mortgages
The Money Advice Service is a free and impartial service, funded by the UK government, which provides a range of information, tools and tips for managing your money. You may find the following articles helpful in understanding how mortgages work, the legal and financial aspects of buying a home, as well as the costs and fees typically involved.
These links are provided for your convenience and for informational purposes only. While we make every effort to ensure that external links are accurate, up-to-date and relevant, we cannot take responsibility for pages maintained by external providers.
Buying your first home
- How much can you afford to borrow for a mortgage?
- How to buy and sell a home through estate agents
- Home-buying process – steps to buying a new house or flat in England, Wales and Northern Ireland
- Leasehold vs freehold: What’s the difference?
- Saving money for a mortgage deposit
- First-time home buyer guide
Understanding Mortgages
Housebuying Costs
- Homebuyer surveys and costs
- The cost of buying a house and moving
- Stamp Duty Land Tax transfer ownership of land or property in England and Northern Ireland
- Contract exchange and completion when buying a home
- Land and Buildings Transaction Tax
- Land Transaction Tax
- Stamp Duty – Everything you need to know
- Find the right solicitor or conveyancer
Good to know
What are the Basic Eligibility Requirements?
All our mortgages are subject to our underwriting process, which includes full employment, credit and affordability checks.
In addition:
- All applicants must be over 18 years old at the time of application
- All applicants must be members of London Mutual Credit Union (or eligible to join)
- At least one applicant must have been in continuous employment for over 12 months, or self-employed for over two years
- All applicants must not be bankrupt, in an IVA, or have been in any other form of legal debt arrangement in the past 7 years
- All applicants must be permanently resident in the UK
Do You Offer Fixed Rate or Tracker Mortgages?
No, currently we offer exclusively Standard Standard Variable Rate (SRV) mortgages, with discounted periods available based on the mortgage loan-to-value ratio (LTV).
Variable-rate mortgages are not suitable for everyone, so you should ensure that you have fully considered the features of this product and the potential risks before you apply.
Do I need to Join the Credit Union Before I Apply?
No. Assuming you meet the criteria for membership, you will become a member of London Mutual Credit Union at the same time as you apply for your mortgage.
These requirements apply to all applicants, so if you are applying jointly, it is important to be sure that everyone meets our membership criteria before you apply.
Can I Remortgage with You?
Yes, our mortgage products are available to both first-time buyers and those with an existing property who are looking to move lenders.
Our discounted rates are available based on Loan to Value (LTV), so if you have built up equity in your current property, you are more likely to be able to benefit from these rates.
What is the Maximum I can Borrow?
We currently offer mortgages of up to £350,000. This is in addition to your deposit or any equity you currently have in the property, so the value of the property itself will be higher.
How Large a Deposit Do I Need?
We currently offer mortgages of up to 80% Loan to Value (LTV).
This means that you need a deposit which is a minimum of 20% of the valuation or purchase price, whichever is lower.