Mutuals are choosing to shun the Government's Help to Buy scheme, insisting that they can insure the high-risk mortgages they decide to advance to new buyers.
The Government’s flagship scheme has encouraged participating lenders to provide mortgages worth up to 95% loan-to-value by offering taxpayer-funded guarantees. Find out more about the scheme here.
Yet (as we’ve been keen to show), smaller banks and mutuals have offered better deals than larger competitors at most loan-to-value ranges, even after the launch of the flagship scheme last month.
Nationwide, Britain's biggest mutual, is ebullient about the performance of its mortgage range without the support of the new scheme.
Its latest figures show substantial growth in mortgage lending, with particular emphasis on first-time buyers.
Gross lending increased by 37% in the first nine months of 2013, to £14 billion, while the society supported over 30,000 first-time buyers – roughly one in five of all successful applicants – over the last six months of this period.
The increase in mortgages has been funded by a huge increase in the volume of savings held with the society, which rose by over £5 billion in the half-year to the end of September.
It also reports that the average LTV on its mortgage stock is less than 50%, emphasising the mutual’s close attention to risk management, despite the help it has provided to first-time buyers.
But avoiding the Government scheme has also helped the society to keep the costs down, according to executive director, Chris Rhodes.
"We are doing our bit and we don’t need support from the government," he said.
"Nationwide has continued to focus on first-time buyers and on promoting the link between saving and access to low deposit mortgage deals.
"As a result, we have increased our gross mortgages lending by over a third and our net mortgage lending by 75 per cent compared to the same period last year."
For the latest selection of Nationwide mortgages, see our dedicated mortgage page. You can also discover how these compare by checking out our comprehensive list of first-time buyer mortgages.
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