Leeds Building Society is the first lender that will accept remortgage applications from Help to Buy Equity borrowers.
The society is offering Help to Buy Equity homeowners the opportunity to remortgage to a competitive rate, and retain their existing loan size, subject to valuation, keeping the government equity loan. Alternatively, they can choose to redeem the Government equity loan as part of their remortgage up to 90 per cent LTV and buy the property outright.
The society will accept remortgages on its existing Help to Buy products which include:
- A two-year discount H2B mortgage at 1.99 per cent available up to 75 per cent loan to value (LTV)
- A two-year fixed rate H2B mortgage at 2.34 per cent available up to 75 per cent LTV
- A five-year fixed rate H2B mortgage at 2.99 per cent available up to 75 per cent LTV
The first Help to Buy Equity borrowers bought their homes in May 2013, and between then and September 2014 more than 31,500 properties have been purchased through the scheme.
“We have seen strong demand for our Help to Buy mortgages since these were launched in August 2013,” said Martin Richardson, Leeds Building Society’s general manager – business development.
“We’re now offering those first customers coming off their initial products the opportunity to re-mortgage onto a competitive new deal. These offers include two and five year fixed rates and a two year discount mortgage up to 75% LTV.
“Borrowers wanting to redeem the Government equity loan as part of their remortgage can choose any of our competitive range of home loans up to 90% LTV.
“Now is an ideal time to remortgage as rates have never been lower. When Help to Buy Equity was launched in May 2013 the average two year fixed rate mortgage was 3.80% but by February 2015 this had fallen to 3.14%[2] – on an average £140,000 mortgage with a 25 year term this would bring down monthly repayments by more than £49 per month.
“In addition, the benefits of a low £199 fee and a free valuation reduce upfront costs for the type of borrowers that Help to Buy was introduced to support.
“Unlike some lenders, Leeds Building Society does not differentiate between first time buyers and home movers and this attractive deal is now available to both.”
John Wakefield of New Homes Mortgage Services in Cannock said: “This is a sign of a return to normality in the lending market. Leeds is a top five building society providing innovative products to help clients meet changes in their personal circumstances, and allowing Help to Buy Equity customers to re-mortgage is a welcome addition.”
Jeremy Duncombe, director at Legal & General Mortgage Club, commented: “This is a fantastic move by Leeds Building Society, demonstrating their support for the market and echoing the innovation they have shown recently in their product range.
“Many Help to Buy customers face a difficult choice when their initial mortgage deal ends, and these options allow them to consider the best alternative for them. Hopefully other lenders will follow suit.”
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