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Woolwich slashes FTB Bovis loans to 3.79%
Barclays, through its mortgage arm Woolwich, has slashed the rate on Bovis Homes’ ‘Perfect 10’ 90% LTV mortgage package by 1.2% to 3.79 per cent for any new-build development in England and Wales.
The deal offers an arrangement fee of £999 and after two years, the rate reverts to a lifetime tracker at base + 2.99 per cent, or 3.49% at Barclays Base Rate.
The deal includes £500 towards legal fees and income protection and is available on any new Bovis Home.
Andy Gray, head of mortgages for Barclays, said: “The deal also gives a measure of protection for customers, Barclays and Bovis Homes and is testament to our commitment to get lending at 90 per cent levels on the right track but in a way which is sustainable in the long term.”
Bovis Homes chief executive David Ritchie said: “In the current climate house builders can’t just be about bricks and mortar, and they can’t sit back while homebuyers battle to raise the funds for a new home.”
Bovis said a typical first time buyer purchasing a Bovis Home at £150,000 would need a mortgage of £135,000 and pay £697.02 a month with the deal saving them around £170 a month. This is £4,000 over the two year period, against the average rate of 5.98 per cent for a two year fixed rate mortgage at 90 per cent LTV.
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Jonathan Burridge, mortgage adviser with mortgage network Maan said the pricing is strong and it’s good to see lenders getting involved in the 90% market.
“Woolwich has always been a strong affordable housing lender and seeing LTVs rising like this indicates lenders are recognising we’re at the bottom of the cycle,” said Burridge.
He added with new-builds, a 90% LTV is practically 100% exposure for a lender, so lending will probably be very selective, with a very tight scorecard and acceptances for the cream of the applicants.
“With a new-build, the value only falls if you actually sell and with most first-time buyers staying three to five years, Woolwich is obviously expecting the market to rise,” he added.
He concluded: “Bring back mortgage indemnity premiums. Let’s start doing 95% LTVs – people need homes and people want to buy homes, so bring it on.”