As part of its bid to simplify and provide competitive rates, Santander has introduced new rates for first-time buyers only, on fixed two-year loans for 90 per cent loan-to-value with a rate set at 4.59 per cent, and a peak loan of £300,000.
Also, other customers looking to buy additional homes or re-mortgage their properties have the option of the new two-year fixed rate set at 4.29 per cent, for 85 per cent LTV – the same as its two-year tracker rate. With a 10 per cent deposit (90 per cent LTV), customers can expect the rate to jump by almost half of a percentage point to 4.75 per cent.
Customers looking for a three-year fixed rate will find that the bank offers a 90 per cent LTV at 4.89 per cent, a rise of 0.14 of a percentage point, and a five-year fixed rate at 4.49 per cent for an LTV of 85 per cent offers a drop of 0.40 percentage point.
The range has a maximum loan of £550,000.
The lender said its range has been introduced after careful consideration of current economic conditions and with a view to helping the consumer out during difficult times.
PROVIDER VIEW
Phil Cliff, director of Santander Mortgages, said: “Now is a great time to take advantage of competitive rates available on mortgages up to 90 per cent LTV. We continually review our product offering to help customers in the current tough economic conditions. It’s especially first-time buyers who struggle to find the extra money for the fees on a mortgage. It can be a barrier to FTBs getting a foot on the ladder, so we’re doing our bit to help them.”
ADVISER VIEW
Dominic Basilea, director of Hertfordshire-based Aqua Wealth Management Limited said: “When I evaluate cost compared to rate it is done on the actual monthly payment – the lower the mortgage amount, the lower the impact of the higher rate. Realistically, if you take a cost of £1000 but you’re getting half the percentage interest rate on a mortgage of £500,000, it could make a big difference. But if it is a small loan amount, the difference would not be too much – so the higher rate could probably be a good solution for the client because it would not increase their balance. So, it’s really a calculation. It’s good that the product is there, but truthfully, to determine if it is a good product or not you have to do a cost analysis.
