How to beat the Help to Buy mortgage guarantee
RBS and NatWest are offering a two-year fixed-rate mortgage at an interest rate of 4.99% and a five-year fix at 5.49%. Neither come with fees. Meanwhile, Halifax has announced two two-year fixes. One has a rate of 5.19% and comes with a fee of £995, and the other has a rate of 5.59% but is fee free.
However, Newbury's three-year variable rate is cheaper than the RBS/NatWest deals. It's 4.89%, reverting to 4.95%, with a free valuation and no arrangement fees. Clydesdale Bank and Yorkshire Bank have also undercut the Help to Buy rates on offer, by trimming the interest on their three-year fix from 5.49% to 4.99%. There are no fees and borrowers will receive a free standard valuation and get £250 cashback on completion.
Get help finding the best mortgage for you shows three even lower rates. Cambridge Building Society has a three-year stepped discounted mortgage at 3.99% in year one and 4.89% in years two and three. It comes with a free valuation and fees of just under £500.
Market Harborough Building Society is also discounting its Family Deposit Mortgage to 3.99% for the mortgage term, but this is aimed at young buyers whose parents save with the society. There is a £95 admin fee.
However, while all of these deals won't suit everyone, it's important borrowers understand there are some better deals at 95% LTV available to them other than the Help to Buy mortgage guarantee products.
95% LTV mortgages that beat the Help To Buy mortgage guarantee deals on rate
|Cambridge Building Society||Three-year stepped discount mortgage||3.99% (year one)*||£499|
|Market Harborough BS||Family Discount mortgage, discounted for term||3.99%||£95|
|Newbury BS||Three-year variable||4.89%||n/a|
|Clydesdale/Yorkshire Bank||Three-year fix||4.99%||n/a|
Note: *4.89% in years two and three
A catch-all phrase that can range from assessing the price of a property or vehicle before offering it for sale or the net worth of assets in an investment portfolio to the prices of shares on a stock exchange.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.