drop lock


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drop lock

n
1. (Banking & Finance) finance a variable-rate bank loan used on international markets that is automatically replaced by a fixed-rate long-term bond if the long-term interest rates fall to a specified level; it thus combines the advantages of a bank loan with those of a bond
References in periodicals archive ?
Flexible Drop Lock mortgages, which have variable rates and the option to switch to another product at any time, may be a solution for some borrowers.
HOME buyers nervous of rate rises should look at the new Drop Lock mortgage range from Yorkshire BS, with a loan-to-value limit of 90%, a tracker rate of 3.
Once borrowers choose a drop lock option, they have to choose between a loan with a big fee and a low rate, or vice versa.
29% would cost pounds 782-a-month, but just pounds 570 on Yorkshire Building Society's drop lock tracker mortgage at 2.
Yorkshire Building Society has entered the Drop Lock market with two three-year tracker products at 2.
It comes with a drop lock facility that allows the rate to be changed in the event that fixed rates move in a favourable direction or if borrowers want to change to a fixed rate.