Coventry cuts fixes by 10 bps and Clydesdale adds broker exclusive
The lender also launched a 95 per cent LTV two-year fixed rate mortgage at 3.65 per cent for purchase and product transfer.
The rate cuts included the two-year fixed rate purchase product at 85 per cent LTV, with a rate of 2.05 per cent, down from 2.15 per cent. The product is fixed and with early repayment charges (ERCs) to 30 September 2023, and has a £999 product fee.
The five-year fixed at 90 per cent LTV was reduced to 3.15 per cent, from 3.25 per cent, for purchase, remortgage, further advance and product transfer. It’s fixed to 30 September 2026, with ERCs to that date, and a £999 fee.
The newly launched two-year fixed at 95 per cent LTV has an end date of 30 September 2023, with ERCs and no fee.
Jonathan Stinton, head of intermediary relationships at Coventry Building Society (pictured), said: “Our high LTV residential mortgages are now even more competitive, which is great news for brokers and their clients with smaller deposits. Whether brokers are looking to help their clients take that all-important first step onto the property ladder, or to support those looking to remortgage to a lower rate, there’s a competitive option for a wide range of clients in our owner-occupier range.
“And we now have a two-year fixed, no fee option at 95 per cent LTV, which is great news for brokers with clients looking to keep their upfront costs low.”
Clydesdale Bank rate cuts
Clydesdale added a new broker exclusive five-year fixed product at 90 per cent LTV, with a rate of 3.19 per cent and fee £1,999.
The lender also cut rates across its two and five-year fixed residential mortgages at 80 per cent and 85 per cent LTV.
The two-year fixed at 80 per cent LTV, with no fee, was cut to 2.23 per cent, down from 2.28 per cent. At 85 per cent LTV, the two-year fixed rate, with £999 fee, came down to 2.18 per cent from 2.41 per cent.
The five-year fixed at 80 per cent LTV, with £999 fee, was cut to 2.05 per cent, from 2.11 per cent. At 85 per cent LTV, the five-year fixed, with £999 fee, was reduced to 2.54 per cent, down from 2.64 per cent.
Additionally, rates were cut on the two and five-year fixed products for London and the South East, at 90 per cent LTV, with £999 fee. The two-year rate came down to 3.42 per cent, from 3.52 per cent. The five-year rate was cut to 3.66 per cent, from 3.76 per cent.
The two and five-year fixed rate products for professionals were reduced by up to 0.15 per cent.
Coventry BS cuts offset mortgages rates; Dudley BS alters BTL and self-build products
Highlights of the changes include a 24 basis point (bps) reduction to 1.35 per cent on its two-year fixed purchase product at 65 per cent LTV.
The rate for its five-year fixed at 65 per cent LTV has also decreased from 1.79 per cent to 1.55 per cent.
Both products are available for product transfer and remortgage, have a £999 product fee and early repayment charges (ERCs) until 30 September 2023.
Coventry Building Society’s head of intermediary relationships Jonathan Stinton (pictured) said: “Offset is a fantastic way for borrowers to make their savings work harder by saving mortgage interest and either reducing monthly payments, make the mortgage term shorter or pay off the mortgage early.
“For brokers, offset gives them more touch points with their clients. Rather than just checking in towards the end of a client’s fixed rate mortgage, brokers could get in touch on an annual basis to see how their clients are progressing with their savings goals and offer support if needed.”
Dudley Building Society improves BTL and self-build options
Dudley Building Society has launched buy-to-let (BTL) and self-build products to support borrowers who buy a new residence whilst renting out their existing property as well as cater for the increased demand for self-build products.
The products include a two-year fixed BTL product at 70 per cent LTV, which has a rate of 3.69 per cent. It is subject to an early repayment change (ERC) of three per cent for the first two years and loans very between £25,000 and £1m. The product also has a fee of £750.
On the self-build side, there are two products with an LTV of 75 per cent at end value and 80 per cent at land value.
The advance mortgage has a rate which is discounted by 0.75 per cent from the mutual’s self-build standard variable rate of 5.49 per cent, while the arrears option is discounted by one per cent.
The products have a fee of £1,000 and offer loan sizes between £100,000 and £1m.
Dudley Building Society’s commercial director Sam Ward said: “Not only does the new fixed rate BTL product benefit from a lower rate, but it also provides a solution to borrowers who buy a new principal residence while renting out their existing property and have attracted a SDLT surcharge.
“With our new fixed rate product which has an ERC of only two years, customers still have the option of selling before the end of year three to claim back the surcharge.
“On the self-build side, we have increased our maximum loan to £1m as research has shown that there is increasing demand for self-build products with larger loan sizes.”
TSB and Coventry BS reduce rates across all LTVs
For first-time buyers and purchasers requiring loans between 80 and 90 per cent loan to value (LTV), rates now begin at 2.29 per cent for an 80 to 85 per cent LTV product with a £995 fee.
The fee-free option is priced at 2.84 per cent.
At 85 to 90 per cent LTV, the £995 fee-paying product has a rate of 2.99 per cent, while the fee-free option is set at 3.19 per cent.
For remortgaging borrowers, products up to 60 per cent LTV, with a £995 fee, have been cut by 0.10 per cent to 1.04 per cent.
For remortgage products at 60 to 75 per cent LTV, with a £995 fee, rates have seen the same reduction to 1.29 per cent, while £1,495 fee-paying options are now priced at 1.14 per cent.
Rate changes are effective from today.
Coventry BS cuts rates by up to 70bps
Coventry Building Society has reduced rates on purchase and remortgage products by as much as 70 bps.
Reductions include the two-year fixed purchase only product at 85 per cent LTV, with a £999 fee. This now has a rate of 2.15 per cent, down from 2.85 per cent.
The five-year fixed product at the same lending tier and equivalent fee has been cut from 3.25 per cent to 2.65 per cent. This mortgage is available for purchase, remortgage, product transfer and further advance.
Rates on interest-only and product transfer deals have also been cut.
Jonathan Stinton (pictured), head of intermediary relationships at Coventry Building Society, said: “As we’re expecting a great deal of existing mortgage deals to be coming to an end in the next few months, as well as plenty of home buyers looking to make their move before the end of the stamp duty holiday, now is the time that brokers can really be adding value for their clients.
“We’re delighted to introduce these rate reductions and make our products even more competitive. This is great news for brokers and their clients, particularly for those with smaller deposits as the larger reductions have been made to the higher LTV products.”
Coventry cuts rates on select 65 per cent and lower LTV residential products
The reductions apply from today and are in place for some of their standard residential, product transfer and offset mortgage ranges.
The rate for its five-year fixed at 65 per cent LTV, which is available for purchase only, will be reduced by 0.14 per cent to 1.65 per cent.
The rate for its two-year fixed at 50 per cent LTV will now stand at 1.09 per cent, a fall of 0.1 per cent. This product is available for remortgage only.
Both the above products are subject to a £999 fee.
Its five-year fixed at 65 per cent LTV with no product fee will now have a rate of 1.75 per cent, down 0.1 per cent.
Coventry Building Society’s head of intermediary relationships Jonathan Stinton (pictured) said: “The next few months will see a lot of borrowers’ current mortgage deals coming to an end, so these products are ideal for those looking to secure their remortgage early.”
Coventry for Intermediaries boosts 95 per cent LTV range
With a rate of 3.59 per cent, the deal has a £999 product fee and is open to purchase and product transfer borrowers.
The Coventry has also cut the rate on its 95 per cent LTV five-year fixed rate deal from 3.89 per cent to 3.79 per cent.
Average 95 per cent LTV two and five-year fixed rates across the market now stand at 3.93 per cent and 4.09 per cent respectively, according to Moneyfacts.
Jonathan Stinton (pictured), head of intermediary relationships at Coventry Building Society, said: “This is great news for brokers and their first-time buyer clients. Our new competitive two-year fixed mortgage at 95 per cent LTV adds more choice to the market and means that more aspiring home owners will be able to take that all-important first step on the property ladder.
And the product is open to all purchase customers, so brokers can also secure a great rate for their clients looking for a higher LTV option.
“Plus, we’ve also recently widened our lending policy on bonus income and increased income multiples for loans greater than 90 per cent LTV, so clients could borrow more.”
Coventry cuts BTL rates and Virgin adds broker BTL products
There’s a two-year fixed rate at 2.15 per cent, down from 2.25 per cent, at 65 per cent LTV available for purchase, remortgage, product transfer and further advance. Early repayment charges (ERCs) start at two per cent for the first year of the fixed rate term, before dropping to one cent.
The five-year fixed product at 65 per cent LTV is priced at 1.89 per cent, down from 1.99 per cent for purchase, remortgage, product transfer and further advance. ERCs begin at five per cent for the first two years of the fixed rate period then declines to two per cent for the subsequent two years, before falling to one per cent in the fifth year.
This product has a £1,999 fee which can be added to the mortgage loan.
Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “This is great for intermediaries and their landlord clients. With many large buy to let maturities due soon, this will help to support the market.
“Plus, there’s no minimum income requirement and all products include a standard valuation fee up to £700,” he added.
Virgin adds BTLs for broker market
Virgin Money has launched a range of buy-to-let mortgages exclusively for the broker market from today.
The new products include a purchase product with a two-year fixed rate at 1.91 per cent at 75 per cent LTV, with £1,995 fee and £1,000 cashback. There’s a five-year version of the same, priced at 2.13 per cent.
There’s also a new portfolio purchase product, with a two-year fixed rate at 2.01 per cent at 75 per cent LTV, a fee of £1,995 and cashback of £1,000. The five-year rate is 2.23 per cent.
Virgin 10-year rate cuts
The lender also cut rates on its core residential mortgages for new business. The 10-year fixed rate was reduced to 1.95 per cent, down by 0.3 per cent, at 65 per cent LTV, with a £995 fee. The 10-year fixed fee-saver, at 65 per cent LTV, was cut to 2.34 per cent, lower by 0.5 per cent.
On buy-to-let and buy-to-let portfolio products for new business, rates were cut across the 10-year fixed range. They all have a fee of £995.
At 60 per cent LTV, the buy-to-let product rate was cut to 2.43 per cent, down by 0.26 per cent. At 75 per cent LTV, is was down by 1.06 per cent to 2.68 per cent.
On portfolio products, at 60 per cent LTV, the rate was reduced by 0.26 per cent to 2.53 per cent. At 75 per cent LTV, the rate is 2.78 per cent, cut by 1.06 per cent.
For product transfers, the residential 10-year fixed fee-saver product at 65 per cent LTV, was cut by 0.15 per cent to 2.34 per cent.
The 10-year fixes for buy-to-let product transfers, both with £995 fee, were also reduced in price. The 60 per cent LTV product was cut by 0.16 per cent to 2.43 per cent, and at 75 per cent LTV, the reduction was 0.66 per cent to 2.68 per cent.
Coventry joins handful of lenders in 95 per cent lending re-launch
The products are priced at 3.89 and 4.09 per cent fee-free and offered up to a maximum loan size of £400,000 at four times loan to income (LTI).
These products are not available for remortgages or further advances, with new-build properties and flats excluded.
Jonathan Stinton, head of intermediary relationships at Coventry Building Society, (pictured) said: “We want to help more people to be able to buy a home, even if they only have a small deposit. Saving for a 10 per cent deposit can be challenging for some would-be buyers and these products help to expand the range of options available to them.”
He added: “We would urge brokers to take full advantage of the affordability calculator and case packaging tools on our website as this will help us to deal with cases as quickly as possible.”
Chancellor Rishi Sunak announced the mortgage guarantee scheme in the budget with six lenders signed up to lend in partnership with the scheme from mid-April.
However, a raft of lenders have launched back into 95 per cent LTV lending outside the scheme with Accord first, followed by Bank of Ireland, which extended its 95 per cent range yesterday, Skipton, Aldermore, Danske Bank and Coventry today, with TSB promising an April launch.
Questions remain over the cost of the scheme and the fact none of the lenders launching without the scheme intend to lend on new build. However, brokers were quick to welcome its introduction as it spurred on an already frenzied homebuyer market given the extension of the Stamp Duty Land Tax holiday also confirmed on Budget day on 3 March.
The government scheme is open to all buyers with a five per cent deposit for properties worth up to £600,000. It has been largely modelled on the previous Help to Buy scheme launched in 2013 to help lenders transition back into the market and is open to second-hand and new-build properties.
The UK’s biggest banks confirmed participation in the scheme from mid-April and include Lloyds, NatWest, Santander, Barclays and HSBC with Virgin Money readying to launch in May.
All mortgages will need to be repayment, not interest-only, on a loan to value of between 91 to 95 per cent and are subject to the usual affordability rules. All participating lenders will be required to offer a five-year fixed rate product as part of its guaranteed range of mortgages.
Help to Buy
The government’s new Help to Buy scheme, which supports new-build lending, will replace the current scheme, which ends tomorrow and runs until March 2023.
The new Help to Buy scheme introduces property price caps and is restricted to first-time buyers only.
Danske Bank and Coventry Building Society re-enter 95 per cent LTV
Danske Bank has gone live with its offering which is available for purchase and remortgage.
The lender has launched two-year and five-year fixed rate products with rates for both at 4.4 per cent during the fixed period which then drops to the follow-on rate, currently at 3.3 per cent.
A full-term tracker is also available at 4.79 per cent.
Applications are open for employed borrowers earning at least £40,000 and are available for properties up to £500,000.
Coventry Building Society
Meanwhile, Coventry Building Society is re-launching it’s 95 per cent LTV mortgage range tomorrow.
Product details will not be announced until the range goes live.
Kevin Purvey, director of mortgage distribution at Coventry Building Society, said: “Helping more first-time buyers get on the property ladder is a key focus for us and we recognise that one of the biggest hurdles facing many of them is the size of deposit required by lenders.
“We continued to support the market last year by lending at 90 per cent LTV and our enhancement to 95 per cent this week will provide further solutions for would be buyers.
“And importantly, our intermediary partners can be confident in our ability to deliver consistent levels of service across our telephony and underwriting teams.”
The duo have joined a flurry of lenders who have re-entered the 95 per cent LTV market during the month.
Accord Mortgages has been joined by Bank of Ireland and Skipton Building Society, with Aldermore doing so temporarily, while TSB announced its intention to re-launch in April.
And six high street names have pledged their backing to the government’s 95 per cent mortgage guarantee scheme which is also due to launch next month.
Coventry BS mortgage lending dips 22 per cent as BTL ticks up
The figure is a steeper fall than the overall UK mortgage market which dropped by 10 per cent from £267bn to £241bn as the pandemic hit last year, according to the Bank of England.
Coventry Building Society also increased its provision for potential future losses on its mortgage loans by £36m, although it said the book was continuing to perform well.
“This year, our approach to lending was more cautious in light of the pandemic, market disruption and the significant uncertainty we faced,” the mutual said in its annual results.
Buy-to-let lending increased as owner-occupier mortgages accounted for 60 per cent of total new lending, down from 67 per cent in 2019, at an average loan to value (LTV) of 65.5 per cent.
And total mortgage assets at the end of 2020 rose by £1.2bn comprising £25.7bn of owner-occupier loans and £17.7bn in buy-to-let loans.
Just 0.09 per cent of mortgage balances were 2.5 per cent or more in arrears, on par with 2019 and below the latest available industry average of 0.69 per cent.
During the year more than 39,000 borrowers were supported with payment holidays which helped keep possessions and forbearance low.
There were 22 cases in possession at the year end from 33 in 2019, while forbearance levels were down by 17.1 per cent year-on-year in value terms and 21.3 per cent in number of cases.
The lender’s CET 1 capital ratio increased slightly to 33 per cent which it expects to continue to be among the highest reported in the UK.
‘Carefully managed’ mortgage activity
Overall, the lender maintained its profitability, recording a profit before tax of £124m which was down slightly from £147m in 2019.
It said its net interest margin recovered in the second half of the year following the Bank of England Base Rate reduction in March, but decreased by 0.02 per cent to 0.81 per cent.
It added that no employee was furloughed and 75 per cent of office-based staff have worked from home since the first lockdown on 23 March 2020.
Coventry Building Society chief executive Steve Hughes said he was pleased with the mutual’s performance during the pandemic, including growing its mortgage book.
“Through the pandemic we continued to grow both mortgages and savings, delivered outstanding service and value to our members and provided strong support for colleagues and the local communities,” he said.
“Despite the market effectively closing down during the first lockdown, mortgage growth was £1.2bn to £43.5bn, as we carefully managed participation through the year.
“In the early weeks of the pandemic, we arranged over 39,000 mortgage payment holidays for borrowers, with the vast majority now resuming payments. Although our mortgage book continues to perform well, we increased provisions by £36m to protect against potential future credit losses.
“Our strong relationship with intermediaries, and our ability to support them with a consistently good service, helped underpin our growth in 2020 and we remain cautiously optimistic that, with the right support, the housing market will remain strong in 2021.”
Coventry BS reduces remortgage like-for-like stress rate
Product fees can be added to the overall value of the remortgage, but early repayment charges cannot.
The mutual said this would give switching clients who do not require further borrowing more options and wider access to its range.
It also said it would allow it to lend to more customers.
Jonathan Stinton (pictured), head of intermediary relationships at Coventry Building Society, said: “It’s a challenging environment for many borrowers, and we know how important some flexibility can be.
“The change to our stress rate in like-for-like remortgages will improve access to our remortgage products while maintaining our prudent approach to lending.”