Accord extends LTV for remortgages

Accord extends LTV for remortgages

Accord Mortgages is to cut the minimum amount of equity required on two of its remortgage products by 5 per cent to give homeowners with a limited amount of equity more flexibility.

From January 22, the intermediary-only lender will introduce two- and five-year fixed rate deals that offer up to 95 per cent loan to value (LTV). Its current range of remortgage products has a maximum 90 per cent LTV.

All of Accord’s 95 per cent LTV remortgages will come with a range of additional features including cashback on completion, free standard valuation and legal fees.

The new range will be available for straight remortgage and capital raising and has a maximum loan value of £500,000.

The lender’s lowest remortgage rate at 95 per cent LTV is a two-year fix at 3.31 per cent, which has a £495 product fee and £500 cashback. A fee-free two-year fixed rate is also available at 3.54 per cent.

Jemma Anderson, mortgage manager at Accord Mortgages, said: "While the housing market is cooling with buyers potentially waiting to see how they’re impacted by Brexit, existing owners may think more about extending or improving rather than moving.

"By increasing our maximum LTV we’re giving borrowers greater flexibility to achieve what they want without necessarily buying a new home."

Nick Rhodes, director of Carlton Rhodes Associates in Hertford, welcomed any new offering but cautioned against borrowing the maximum amount in the current climate.

He warned borrowers ran the risk of being stranded on lenders’ standard variable rates that, historically, could be double their introductory offers.

Mr Rhodes said: "I would highlight that anyone remortgaging up to 95 per cent of the value of their property in a cooling market will be running the risk of potentially becoming a mortgage prisoner if the value of their property decreases and their current lender does not offer them a competitive deal at the end of any fixed rate mortgage."

Ian Skerritt, director at Teesside Money, said the products were good news for the market in a time of uncertainty.

He said: "These are very competitive products from Accord, low rates and an attractive cash back offering. I am sure this will be very popular in the mortgage market."