Accord Mortgages is to offer reduced rates on its high loan to value (LTV) mortgages to help borrowers with smaller deposits.
From today (January 11), borrowers with a 5 per cent deposit will benefit from rates starting at 3.21 per cent for a two-year fixed rate and 3.54 per cent for a five-year fixed rate, both of which have a £495 product fee.
For a 95 per cent LTV mortgage with no product fee, the rates start at 3.49 per cent and 3.66 per cent for the two- and five-year fixed, respectively.
The lender is also offering £1,000 cashback on completion and a free standard valuation across the range.
The intermediary-only lender, which is part of Yorkshire Building Society, has also made changes to its 90 per cent LTV mortgages, with rates reduced by up to 0.27 per cent.
Borrowers with a 10 per cent deposit looking to purchase or remortgage a house can now get a five-year fixed rate of 2.50 per cent. This mortgage comes with a £995 product fee.
Alternatively a two-year tracker mortgage is available at 1.99 per cent (previously 2.24 per cent) for two years, with free standard valuation and a £995 product fee.
Jemma Anderson, mortgage manager at Accord Mortgages, said: "Buying or moving house can be expensive so we hope this new range of mortgages will give brokers and their clients a little help with managing the associated upfront costs."
Daniel Bailey, principal at Derbyshire-based Middleton Finance, said: "It is positive news for borrowers that Accord are lowering their rates for 95 per cent LTV mortgages.
"The deposit is one of the biggest obstacles for home ownership. Associated costs with buying a house can be expensive so a free standard valuation and £1,000 cash back will be very useful for borrowers.
"It is important to speak to a local mortgage adviser and compare all deals available and establish which is the cost effective."
Jenny Turton is a freelance reporter for FTAdviser