Residential  

Nationwide launches 95% mortgages at below 4%

Nationwide launches 95% mortgages at below 4%
 Credit: Luke MacGregor/Bloomberg

Nationwide has reintroduced 95 per cent LTV mortgages outside of the government’s guarantee scheme.

The mortgages have launched today (May 20), with rates starting at 3.49 per cent, and all products costing less than 4 per cent.

Two- and five-year fixed rates will be available, as well as a two-year tracker product.

Henry Jordan, director of mortgages at Nationwide Building Society, said: “As one of the leading lenders to first-time buyers, we feel confident returning to the 95 per cent LTV market without the need for the mortgage guarantee scheme.

“By not being part of the scheme, we can provide improved value to our members and this is demonstrated by the market-leading rates we’re announcing.”

It comes after brokers expressed caution over rates offered at 95 per cent as lenders continue to launch products in the high LTV tier.

Nationwide’s new range will be available to homemovers who are new to the building society as well as first-time buyers, with the latter receiving £500 cashback when they complete their mortgage.

However, the 95 per cent LTV range will only be available to employed borrowers and excludes flats and new-build houses.

The products will be available through brokers as well as directly through Nationwide by phone, video appointment and in-branch.

Nationwide’s 95 per cent LTV range

Product

Fee

Rate

Two-year fixed rate

£1,499

3.49%

£999

3.69%

No fee

3.84%

Five-year fixed rate

£1,499

3.79%

£999

3.89%

No fee

3.99%

Two-year tracker rate

£1,499

3.59%

£999

3.79%

No fee

3.94%

Alex Kemp, partner at Ideal Mortgage Advisers, commented: “We feel that Nationwide entering the 95 per cent market is a huge step forwards for the market as they are the largest lender offering 95 per cent rates not via the mortgage guarantee scheme, and their rates are the lowest on the market.”

The building society is also adding three 95 per cent LTV products for existing customers moving home, all of which carry a £1,499 fee and match equivalent new customer rates.

Nationwide’s upcoming 95 per cent LTV launch comes after the building society introduced its ‘Helping Hand’ mortgage in April to give first-time buyers the option of borrowing up to 5.5 times their income when taking a five- or ten-year fixed rate up to 90 per cent LTV.

chloe.cheung@ft.com

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