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.
A quick comparison at Moneywise.co.uk 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