On 4th February 2014, NatWest Intermediary Solutions reduced the rate on its 'no product fee' 85% loan to value (LTV) two year fixed rate by 0.1%, bringing it down to 3.65%. Speaking of the move, Mark Bullard, head of sales at NatWest Intermediary Solutions said, “It has been a great start to the year reflecting the confidence intermediaries currently have for the mortgage market's prospects.
NatWest's two 5 year fixed 60% LTV deals saw slight increases, with the £995 product fee deal rising from 2.88% to 2.95%, while the no product fee deal saw an increase to 3.25%, up from 3.19%.
Santander also made changes to its rates, reducing its 'flexible offset' mortgage rate (which uses a guaranteed tracker rate for life, allowing customers to use their savings to offset their mortgage) to 3.09% with a £495 fee. As well as being able to port their mortgage to another property, the 'flexible offset' mortgage allows customers to both overpay and take a mortgage holiday, and are able to pay off the balance without facing an early repayment charge.
Both moves came after mortgage lending returned to pre-crisis levels not seen in the UK since 2008, with statistics showing lending up 38% last month on December 2012. With confidence in the markets returning and approvals for house purchases reaching the highest level since 2007, David Dooks, statistics director at the British Banking Association, commended the role played by the government's schemes to help first-time buyers. “Assistance schemes are helping first-time buyers and housing chains generally, as housing market activity rises.”
Santander bosses echoed this positive outlook for first time buyers, indicating last week that they plan on increasing the lending to first-time buyers in 2014, up from £3.4 billion in 2013.
The Online Mortgage Advisor team welcome positive news like this. Even as the funding for lending scheme for mortgages has been scrapped we are seeing further decreases in mortgage rates for LTV's that aren't backed by the Help to Buy Scheme.