Newcastle BS trims resi rates and TSB updates BTL products
The lender has reduced rates on several two and five year-products with £999 and zero fee options.
This includes the two-year fix with £999 fee cut by 20 basis points (bps) to 2.5 per cent.
Zero-fee deals include the two-year fix reduced by 15bps to 2.65 per cent and the five-year version which is reduced by 14bps to 2.85 per cent.
All products in the refreshed range attract free standard valuation and allow 10 per cent overpayments per year.
John Truswell (pictured), head of intermediary mortgages at Newcastle Building Society, said: “We’re always reviewing the market to ensure our products remain competitive for clients and borrowers.”
Meanwhile, TSB has updated its buy-to-let (BTL) range by also cutting rates and introducing new products.
The lender has cut rates on its 60 per cent LTV purchase and remortgage products with zero fee by 25bps – the two-year version is at 1.94 per cent and the standard five-year fix is at 2.14 per cent.
It has also launched five-year fixes with three years’ early repayment charges (ERCs) at 60 and 75 per cent LTV at 2.34 per cent and 2.74 per cent respectively.
And a two-year tracker at 60 per cent LTV with £999 fee and no ERCs has been added at 1.79 per cent above Bank of England Base Rate, giving a current rate of 1.89 per cent.
Twenty7Tec poised to roll out integration with TSB
In the project, Twenty7Tec integrated with Iress Lender Connect software, which TSB is using to transfer data into the intermediary portal.
Users of CloudTwenty7 will be able to complete a full TSB application in the CloudTwenty7 platform, using customer data they have already captured, then pass this through to TSB and submit an application.
The integration with TSB is now in pilot with Mortgage Advice Bureau and Connells, with a wider roll out planned to all CloudTwenty7 users in Q2 2021.
“TSB has strived consistently to use technology to make advisers’ lives easier. With this integration, we, and TSB, have delivered a solution offering significant and tangible benefits to advisers — reducing time spent keying data and supporting a more efficient application submission process,” said James Tucker, chief executive at Twenty7Tec (pictured).
Roland McCormack, mortgage distribution director at TSB, said: “We are delighted to have partnered with Twenty7Tec to reduce the keying time for brokers, especially important in today’s market.”
This latest Apply integration with TSB follows on from similar projects already announced by Twenty7Tec this year, with Halifax, in March, and Aldermore in February.
Top ten mortgage broker stories this week – 09/04/2021
Elsewhere, TSB raised its maximum age, more 95 per cent LTV mortgage choice hit the shelves and a thought-provoking feature on mental well-being revealed a quarter of brokers responding to our latest poll were struggling in some way to cope with the stresses of the pandemic.
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Changes include a revision of the way annual mortgage interest is calculated.
For a standard buy-to-let application, if the landlord is going for a fixed rate of less than five years, it will use annual mortgage interest of either 5.5 per cent or the product rate plus two per cent.
For longer term products, annual mortgage interest of either 4.5 per cent or the product rate plus one per cent will be considered.
For like-for-like remortgages, annual mortgage interest of either 4.5 per cent or the pay rate plus one per cent will apply for all fixed rate terms.
Annual rental income should be more than 145 per cent of the annual mortgage interest to pass affordability.
These changes follow the launch of 95 per cent loan to value (LTV) residential mortgages, which were announced earlier today.
TSB launches 95 per cent deals
Rates start from 4.04 per cent and deals come with £500 cashback.
TSB is offering the deals outside of the government’s 95 per cent mortgage guarantee scheme.
Borrowers can choose from a five-year fixed rate which has a choice of three and five-year early repayment charges which are open to both first-time buyers and house purchases. A zero fee and £995 fee option are available. Rates for the five-year fix with three-year early repayment charges start from 4.24 per cent.
A stepped down first-time buyer deal, with zero fee, has annually reducing rates until 31 August 2026. In year one the rate is 4.44 per cent and in the final year the interest rate is 4.09 per cent.
A ten-year fixed rate is on offer between 85 per cent and 95 per cent LTV, with a five-year early repayment charge. The deal is priced at 4.45 per cent and has no product fee.
Lending above 85 per cent LTV can only be secured on houses and bungalows.
Borrowers who earn £40,000 or less will be subject to an income multiple of 4.25 times earnings while those earning more than £40,000 will be offered a mortgage of up to 4.49 times their income.
TSB adds remortgages up to 90 per cent LTV; Nationwide cuts rates and updates EU criteria
They include a remortgage for 60-75 per cent LTV with a £1,495 fee. This has a rate of 1.29 per cent. There is also the product at 85-90 per cent LTV with a £995 fee, with a rate of 3.14 per cent.
The products offer a free valuation as well as the choice of £300 cashback or free legals.
Both products are available from today.
Nationwide cuts rates and amends criteria for EU applicants
Nationwide has reduced rates on two and five-year fixed products up to 80 per cent LTV.
Shared equity deals have been cut by up to 0.35 per cent. A two-year fixed at 0-60 per cent LTV with a £999 fee now has a rate of 1.34 per cent, down from 1.44 per cent. The fee-free option has a rate of 1.74 per cent down from 1.84 per cent.
Larger reductions were made across five-year fixed shared equity products.
This includes the fee-free product at 75-80 per cent LTV which has been cut by 35 basis points to 2.69 per cent. The £999 fee-paying alternative has also seen the same reduction and is now 2.49 per cent.
A five-year fixed purchase product at 60-75 per cent LTV has been cut by 0.05 per cent to 1.94 per cent. Reductions of 0.10 per cent to first-time buyer deals at the same tier, fixed for either two or five years also bring the rate to 1.94 per cent.
EU and EEA applicants
From 26 April, a decision in principle (DIP) carried out before the stated date but not submitted to a full application for any EEA national will be cancelled.
To proceed with an application that has been cancelled, a new DIP will need to be completed.
For non-UK and Republic of Ireland (ROI) nationals with no indefinite leave to remain or settled status, Nationwide will only lend up to 75 per cent LTV.
The lending limit will not apply to if the second applicant is a non-UK or ROI national and their income is not used for the application.
If an applicant does not have indefinite leave to remain or settled status, Nationwide will accept a number of approved visas including a residence card or UK ancestry visa. They must also have a minimum of two years and six months remaining.
Applicants must be able to fund a minimum 25 per cent deposit from their own resources for purchases or have 25 per cent equity in their homes property for remortgages or additional borrowing.
For joint applications, the deposit from own resources can come from either or both applicants.
Purchase and remortgage offers to EU and EEA applicants will be valid for 180 days, and switches will be valid for 45 days. Further advance offers will have a period of three months.
New build offers can be extended for 45 days on request depending on eligibility and criteria.
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.
Top ten most read mortgage broker stories this week – 26/03/2021
Elsewhere, an opinion piece from Hiten Ganatra that dished out a healthy note of scepticism of the government’s 95 per cent LTV grabbed readers’ attention as did news that more shared ownership homes would be built using Right to Buy receipts.
Lenders tighten self-employed affordability – MBT
Let’s not expect miracles from government’s mortgage guarantee scheme – Ganatra
TSB confirms April return to 95 per cent lending
Vernon BS launches cheapest 90 per cent LTV mortgage
Shared ownership boost as councils will build more homes from Right to Buy income
Accord and Coventry BS cut high LTV rates
Skipton relaunches 95 per cent LTV mortgages but cautions on short-term availability
Virgin Money cuts high LTV rates by up to 0.16 per cent
Greedy, unethical brokers must not be allowed to pollute bridging market – Coates
Quarter of homeowners miss mortgage payments due to ill health – MetLife
TSB confirms April return to 95 per cent lending
The products will be available direct and through the broker-channel to first-time buyers and home movers.
Product rates and fees will be confirmed ahead of launch and applicants may borrow up to £500,000. Applications for flats or new-build homes will be capped at up to 85 per cent LTV.
Nick Smith, TSB’s head of mortgages said: “We know that for many first-time buyers, raising a deposit is often the biggest challenge. We were one of the first lenders to return to offering 90 per cent LTV during the pandemic, and we’re pleased to now reintroduce our 95 per cent LTV range giving further options for first-time buyers and those wanting to move home.”
At the start of March, TSB returned to 90 per cent loan to value (LTV) lending for self-employed borrowers and increased the amount of bonus, overtime and commission income that can be used to support the application.
The bank introduced a temporary cap of 75 per cent LTV where one or more borrowers are self-employed in November. It said this was to ensure it continued to lend responsibly during the pandemic and protect service levels.
TSB overhauls low LTV residential and BTL rates
The lender has cut its two-fixed residential remortgage at 60 per cent loan to value (LTV) with £1,495 fee by 0.1 per cent to 1.09 per cent.
However, the five-year version with five-year early repayment charges has been increased by 0.1 per cent 1.29 per cent.
Prior to the move, the two products had been on the same rate despite the difference of three years in fixed period.
Meanwhile, on its buy-to-let offering, the lender has cut the rate on its two-year fix for purchase and remortgage at 60 per cent LTV with no fee by 0.2 per cent to 2.19 per cent.
Again, this was previously at the same rate as its five-year version.
And TSB has slashed its 10-year fixes for purchase and remortgage at 60 per cent LTV by up to 0.95 per cent.
The £995 fee version is at 2.54 per cent and the fee free option is at 2.64 per cent.