Personal Finance: Internet Investor: Looking for a loan on-line

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Indy Lifestyle Online
Base interest rates went up earlier this month - you probably noticed. However, you may not have noticed the trickle of increases in rates by various mortgage lenders. Many building societies say they will hold their standard variable mortgage rates unchanged at least until the end of this year. Most of the bank mortgage lenders have already put their mortgage rates up.

If you want to know exactly why the Bank of England decided to raise interest rates, the minutes of the Monetary Policy Committee meeting held on November 5-6 will be published on December 10 and you will be able to read them for yourself on the Bank's website.

But what of mortgage rates? Who is offering the best deal and how long for? A new website, Moneynet, offers an independent interactive service, Mortgage Finder, which lists rates, discounts, conditions and special offers from more than 80 mortgage lenders. Details of mortgage rates and offers are updated daily.

Using Mortgage Finder, you can review fixed rate, discounted, capped or variable rate mortgages, those offering a cashback or any mix of the above. In addition to interest rates, a full breakdown is available for each product, highlighting relevant information such as early redemption penalties, any insurance insisted upon by the lender and any arrangement fees charged.

Moneynet is a work-in-progress. The site includes a section on FAQs (frequently asked questions) and will have a mortgage calculator, which is currently being built. It is best viewed using Microsoft's Internet Explorer rather than Netscape Navigator, the other main web browser. In future, the site aims to include information about conveyancers and insurers.

While you can search for a mortgage on the world wide web, you still cannot yet arrange one on-line. However, the Council of Mortgage Lenders (CML), the trade body which represents lenders accounting for about 98 per cent of all the mortgages in the UK, is now weighing up the feasibility of mortgage trading being carried out electronically by intermediaries - financial advisers - still one step removed from consumers.

Meanwhile, the CML has launched its own website which contains information on its members and provides links to lenders' websites. It offers consumer information in the shape of guides to buying a home in England and Wales and buying a home in Scotland. The site also contains a range of consumer factsheets, press releases and statistical data on house prices and mortgage arrears.

Though you cannot arrange a mortgage on-line, there is now a mortgage account that you can manage on the web. It is Legal & General's Flexible Reserve Mortgage, which, in early 1995, was the first flexible mortgage to be offered in the UK. L&G has launched InterPlan, an interactive approach to managing money on the Internet and as a first step is offering an on- line mortgage management service.

The Flexible Reserve Mortgage allows you to make extra payments, at any time, to reduce the outstanding mortgage and create an available reserve. It offers a competitive variable rate of interest, which L&G promises will never be more than 1.5 per cent above bank base rates. The rate is currently 7.7 per cent, equivalent to an APR of 8.0 per cent.

Using InterPlan you can see at a glance your outstanding mortgage.Statements are updated daily and list your last five lump sum transactions, your current mortgage balance and the amount available to you in your available reserve. You can also submit transaction requests, arranging to make lump sum payments, amend or instruct an additional monthly payment, take a payment holiday or borrow back money from your available reserve.

There is also a personal planner calculator which allows you to see the effect of making mortgage overpayments, borrowing from your Available Reserve or taking payment holidays.

Bank of England: www.bankofengland.co.uk

Moneynet: www.moneynet.co.uk

Council of Mortgage Lenders: www.cml.org.uk

Legal & General InterPlan: www.legal-and-general. co.uk/iplan

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