A number of new mortgages launched by the Yorkshire Building Society and its subsidiaries are offering buyers even better rates than the Government's Help to Buy scheme.
New deals have been made available through Yorkshire, Barnsley, Accord, Chelsea, and Norwich & Peterborough, increasing the total number of 95% mortgages available to new buyers by around 50% overnight.
The announcement aligns the Yorkshire Group with Nationwide, which has also shunned Help to Buy.
Britain’s biggest mutual said this week that it did not need the scheme to assist first-time buyers, adding that the cost of insuring Help to Buy mortgages made the loans more costly for consumers (read more).
The Yorkshire Building Society’s 2-year fix at 4.89% is cheaper than the best Help to Buy deal currently available at this term (4.99% through RBS/NatWest). The product does have a £130 product fee, but successful applicants will receive £500 back in cashback from the lender.
The Norwich & Peterborough Building Society is also offering a 4.89% deal for two years, with no arrangement fee. The product also offers a free valuation and a £500 rebate, making it another very attractive proposition.
Those wishing to fix for longer might be encouraged by Yorkshire Building Society’s 5-year fix at 5.09%, with a fee of £975.
The 5-year deal comfortably outperforms the best Help to Buy deal at this term (5.49% through RBS/NatWest), while it also beats off stiff competition from the Leeds Building Society, which offers a 5-year fix at 5.19% (£999 fee).
Local Lenders
More impressive yet is that several of these deals from the Yorkshire Group are themselves outperformed by local lenders.
The one downside here is that the mortgage can only be applied for in branch, which is only likely to benefit those in the North West and Cumbria (pictured right).
The Loughborough Building Society is also offering an impressive 5-year deal, at 4.99%, with just a £99 fee.
The downside here is that the low maximum loan size (£150,000) will limit the number of properties for which this product will be eligible.
So, as we’ve advocated before in our guide to Help to Buy (under ‘Are there any alternatives?’): if you’re looking to move on to the housing ladder, it’s worth drawing up a shortlist of local lenders in the region.
Though eligibility can be more limited when it comes to mutuals, the added competition for first-time buyers provided by Yorkshire Building Society and its associates demonstrates that Help to Buy is not the only (or the cheapest) option for first-time buyers.
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