Mortgage bulletin for week commencing 20th October
There have been many headlines about low-rate mortgages during the last week and, while there are some bargains out there, the large fees associated with many low rates can add substantially to the cost of borrowing.
HSBC has gone below the 1% line with its 0.99% two-year discount tracker. The product has a large fee of £1,999 and is available for loans up to £500,000 at 60% loan-to-value (LTV). That large fee may make it more expensive overall than higher rates that nevertheless come with lower fees or no fees at all.
Other HSBC mortgages include a two-year fixed-rate up to 60% LTV at 1.99% with a lower booking fee of £999 and a fee-saver at 2.39% with no booking fee. A 60% LTV lifetime tracker with HSBC is currently 1.99% (Bank of England base rate plus 1.49%) with a booking fee of £999 or 2.39% (Bank of England base rate plus 1.89%) with no fee.
TSB also offers a range of loans at 60% LTV, though there are limits to the size of loan which borrowers should be aware of. The cheapest, at 1.79%, has a fee of £1,995, but is only available for loans between £200,000 and £1m. A rate of 2.14% comes with a lower fee of £999 and a wider loan size range of between £5,000 and £1m. The fee-free option at 2.54% is only available on loans below £200,000.
Norwich and Peterborough Building Society is offering a two-year tracker discounted to 1.49% with a £345 fee on loans up to 60% LTV.
For those with smaller deposits, Leeds Building Society has refreshed rates on its range of five-year fixed-rate mortgages from 3.39% to 3.34% at up to 80% LTV, and from 3.99% to 3.79% up to 85% LTV. Both new rates have a £999 fee. The Society also offers a fee-assisted five-year fixed-rate mortgage up to 85% LTV, reduced from 4.14% to 3.99%. This comes with a £199 fee, free standard valuation up to £335 and assisted legal services for standard remortgages.
Santander is offering two-year fixed-rate and tracker mortgages to home movers and first-time buyers looking to borrow up to 80% LTV. Their two-year fixed rate is 2.79% with a booking fee of £995. For loans up to 85% LTV, Santander is offering a two-year fixed rate to home movers and first-time buyers via intermediaries at 3.19% with a fee of £995 or 3.79% with no fee on loans up to £750,000.
Coventry Building Society has a two-year +1.15% Bank Base Rate Tracker, with fees of £999 and valuation of up to £670 on loans up to 65% LTV.
Leek Building Society is offering existing borrowers a two-year fixed-rate mortgage up to 75% with no fee on loans up to £500,000. New customers with a 25% deposit who take out a two-year discounted mortgage with Leek can benefit from an introductory rate of 1.74%, a massive discount on Leek's standard variable rate, currently 5.19%, no application fee and £250 cashback payable on completion.
Meanwhile, all of Nationwide’s 95% LTV Save to Buy mortgage rates have been reduced by up to 0.70%. The two-year fixed-rate is 4.79% with a £999 fee (with a reduced fee of £499 for first-time buyers), and the three-year fixed rate is 5.19% with a £999 fee for new borrowers (£499 for first-time buyers). Existing mortgage customers benefit from an additional 0.10% discount on the new customer rates.
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