Mortgage bulletin for week commencing Monday 23 December

Posted 24 December 2013

With forecasts of an 8% rise in house prices over the next 12 months and private rents predicted to rise by 10% in the same time frame, first-time buyers and those looking to buy-to-rent are seeking out bargain mortgages to secure their dream new home.

Among the lenders providing new deals for would-be homeowners are Clydesdale Bank and Yorkshire Bank. As well as products for those looking to take their first step on the property ladder, there are a number of mortgages fixed for two and five years which come with £500 cashback and no arrangement fees on selected products.

Until 16 February 2014, both banks are offering a three-year fixed-rate mortgage for residential customers looking to borrow at least £25,000 with a rate of 3.99% at 90% loan-to-value (LTV) or 4.99% at 95% LTV. The banks' five-year fixed-rate deal at 90% LTV is now 4.59%. Loans up to 60% LTV, with £500 cashback, are at the new rate of 2.69%, fixed for two years or 3.59% fixed for five years.

Alternatively, lower-rate mortgages are also available with no cashback and fees of £999 including a two-year fixed rate at 2.19% at up to 60% LTV and 3.89% at up to 90% LTV. Five-year fixed-rate deals are available at 3.39% at up to 70% LTV and 4.29% at up to 90% LTV.

Andrew Pearce, retail director for Clydesdale and Yorkshire Banks, says: "We understand that people have different needs so we have extended our range of mortgages to meet these varied demands. We have fixed rate mortgages for two and five years as well as a number of products with no arrangement fee. There is also the opportunity to benefit from a £500 cashback on selected products depending on individual requirements and circumstances."

first direct has introduced a new 65% LTV 1.99% offset mortgage on a two-year fixed-rate with £1,499 booking fee. In addition, the bank has reduced the rates on the majority of its mortgages by 0.2% allowing borrowers with 25-35% deposit or equity to take advantage of these lower rates, which are offered with and without fees. All existing offset mortgage rates will reduce by 0.2% no matter what LTV or term.

Other deals include a two-year fixed-rate repayment mortgage at 1.99% for loans up to 65% LTV, with a £499 fee, or at 2.29% fixed for three years. The lender's Repayment Tracker mortgage is currently 2.29% at 65% LTV and its Base Rate Tracker at 2.79%, both with £499 fee. For those looking for up to 90% LTV, first direct offers a two-year fixed-rate deal at 3.59% with £1,499 fee and Life Tracker at 3.99%. Both of these 90% LTV deals attract fees of £1,499.

Virgin Money buy-to-let deals, available exclusively via intermediaries, have had their rates reduced. Their two-year fixed-rate is now available at 2.89% at 60% LTV and 3.19% at up to 70% LTV, both with a £2,495 product fee. Direct customers can get deals of 3.25% at 60% LTV with fees of £1,995 and 4.59% with no fees. Virgin Money's direct buy-to-let three-year fixed-rate mortgage is reduced by 0.9% to 4.69% at 60% LTV. Virgin Money is also offering buy-to-let investors with a 40% deposit a reduced two-year tracker mortgage rate of 3.55% with a £995 product fee, a reduction of 0.20%, or 2.89% with a 2.5% product fee - a reduction of 0.10%. A £750 cashback is available to many of Virgin's buy-to-let mortgage range, excluding exclusive intermediary deals.

Anthony Mooney, director of financial services at Virgin Money, says: "We are delighted to announce the launch of our new range of competitive buy-to-let products, which underlines the importance we place on this segment of the market."

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