The mutual has reduced the rate on its 95% two-year fixed rate mortgage from 5.95% to 5.59% and also removed the early repayment charge on the mortgage.
The product has no completion fee but a £195 reservation fee applies.
The lender said it hoped to make its offering more attractive to borrowers who may wish to overpay in future if their circumstances change.
The product will be made available through Legal & General, Openwork, Sesame, PINK, TMA, First Complete, Intrinsic, Positive Solutions and Brilliant Solutions advisers.
Steven Marks, corporate development executive for Newcastle BS, said: “This reduction in the rate of our 95% LTV product demonstrates how Newcastle BS is committed to supporting borrowers as it provides an opportunity for those with a smaller deposit to access a competitive mortgage product.
“Additionally, the no ERC feature gives more flexibility to a person if their circumstances change.”
Newcastle’s rate cut follows similar changes at other smaller lenders. Last week Cambridge BS launched a stepped 95% deal for first-time buyers while Saffron BS has also refreshed its high LTV range.
