Mortgages  

Leeds unveils two HTB remortgage deals

Leeds Building Society has launched two remortgage products of up to 75 per cent LTV for homeowners who bought their homes through the government’s Help-to-Buy equity scheme.

A rate of 2.44 per cent is applicable to a new two-year fixed-rate HTB product.

A five-year fixed HTB product is now available at 3.14 per cent.

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Both deals come with fees-assisted legal services for standard remortgages.

All the Leeds’ HTB mortgages and remortgages come with a £199 fee and free valuation.

The products stand alongside the society’s existing HTB mortgages, which are available for remortgage as well as home purchase, including a two-year discount HTB mortgage at 1.99 per cent and two- and five-year HTB fixes at 2.34 per cent and 2.99 per cent respectively.

Last month, the mutual – which was the first lender to accept remortgage applications from existing HTB Equity homeowners – launched a 10-year fix at 3.64 per cent up to 80 per cent.

Provider view

Martin Richardson, Leeds Building Society’s general manager, business development, said: “The first homeowners who bought under the HTB equity scheme are now coming to the end of their mortgage deals and have their first opportunity to switch to a better deal.

“Mortgage rates are at historic lows at present, and the average two-year fixed-rate mortgage available now is lower than when the government launched the scheme in March 2013, so borrowers can save some money by switching to a more competitive deal.

“Minimising the upfront costs of our HTB remortgages assists the type of customer the scheme was introduced for. Unlike some lenders, Leeds Building Society does not differentiate between first-time buyers and home-movers, and our main HTB range is available to both.”

Adviser view

Asif Sadullah, IFA at North Yorkshire-based Pen Life Associates, said: “I know that there are better deals out there. They are two-year deals at under 2.5 per cent. One of the issues for Help-to-Buy applicants is looking for a decent remortgage deal. A lot of people will rely on their existing lender to give them a decent rate.

“Help-to-Buy schemes suit a smaller pocket of buyers who are on good salaries but have low deposit. Unfortunately those with low salaries and deposits are finding it increasingly difficult to get onto the property ladder.

“When Help-to-Buy schemes were first made available, it was something handled by only a handful of lenders. There are now enough lenders to create a competitive market.”

Charges

£199 for both HTB remortgage products.

Verdict

Following its launch two years ago, the government’s Help-to-Buy scheme has been widely praised for giving a many people with small deposits the opportunity to purchase property for the first time. After enjoying the honeymoon period that comes with a new house purchase, a large number of Help-to-Buy applicants are now facing a difficult task shopping around for the best remortgage rates. Although the number of lenders offering Help-to-Buy schemes is on the rise, there are still a few remortgage deals available. Help-to-Buy owners may envy ordinary homeowners who have seen a dramatic reduction in rates thanks to a record low base rate.