How individuals in Lancashire can get cheaper mortgages because of new scheme

Lancashire homebuilders Barratt and David Wilson Homes have joined a scheme with Own New to supply decrease charges for consumers of latest build properties in Lancashire.

The new scheme, labelled Rate Reducer, launched this month with Halifax, Virgin Money and Barratt Developments, and beneath it, charges under 1.89 per cent may very well be available for some consumers with a excessive deposit or fairness. The scheme will provide extra energy to shoppers over their month-to-month outgoings, which in flip will give many extra individuals the boldness to make their first or subsequent home transfer. Own New Rate Reducer works through the use of incentive budgets which housebuilders provide to clients to scale back their month-to-month mortgage funds over a hard and fast time period. For instance, if the housebuilder affords a 5% incentive on a home, Own New Rate Reducer takes this sum and instantly offsets it towards the mortgage curiosity to scale back month-to-month funds. Buyers can choose to unfold the profit throughout the primary two or 5 years, relying on the lender’s standards. In addition to reducing month-to-month outgoings throughout that point, the client can pay extra off the capital worth of their mortgage as a result of the curiosity charged on the mortgage is decrease.

Lenders will nonetheless perform their standard affordability evaluation, to verify that the purchaser can afford repayments if the rate of interest will increase as soon as the fixed-term profit ends. Also, unbiased monetary recommendation should be sought from a regulated mortgage dealer who has accomplished extra coaching to access this scheme.

Own New works intently with every lender, with a goal – to offer clients the total advantage of the developer contribution by lowering their curiosity funds by not less than the identical worth as the inducement.

Lancashire homebuilders Barratt Developments labored alongside Own New to design Rate Reducer and was the primary housebuilder to launch the scheme.

Eliot Darcy, Founder of Own New, mentioned: “Our ethos is to make home ownership and mortgage lending in this country open to more people and we are confident that the launch of the Own New Rate Reducer will achieve that.

“Alongside the national lenders and housebuilders who have signed up to the scheme, we believe that Rate Reducer will be a significant boost to many people’s home-buying dreams. People can benefit from Rate Reducer whether they have a small or large deposit. For some people who already have equity in their home, it could herald the return of the sub-1% mortgage deal. “We are delighted to be joined by Halifax and Virgin Money for the launch. By working together, we are increasing mortgage lending opportunities and bringing the possibility of owning a new-build home to wider range of buyers.

“This is just the product to stimulate the housing market and to give more people a helping hand and initial boost to get onto the property ladder or to secure that new home that will give them the extra space they need.”   

Steve Mariner, Sales and Marketing Director at Barratt Developments, mentioned: “By launching the Own New Rate Reducer scheme we are helping more people to be able to afford a home. “The scheme gives buyers the financial boost they need to get them onto the property ladder. They will be able to compare all the options available to them to make sure they get a mortgage product that is right for them and in their long-term financial interests.”

Craig Calder, Head of Secured Lending at Virgin Money, mentioned: “We’re delighted to be a founding lender of the innovative Own New Rate Reducer, making it easier and more accessible for customers to afford a new-build home. “Buying a home is a major life event and this first-of-its-kind mortgage product will help customers feel happier about their big purchase, knowing that they have the certainty of a lower fixed interest rate over the initial period of the mortgage. By using the homebuilder incentive budget to offset initial mortgage repayments, buyers can focus on other costs like furnishings and decoration, to make their house a home.   “At Virgin Money we’re continually looking at new and inventive ways in which we can assist borrowers, with Rate Reducer following hot on the heels of our recent Fix and Switch product, which also provides certainty and flexibility.”

Amanda Bryden, Head of Halifax Intermediaries, mentioned: “We know that buying a new home is a big commitment for our customers so we’re thrilled to be one of the first lenders to offer the Rate Reducer incentive through participating builders. “This product gives customers more choice in the way they can benefit from builder incentives and is especially helpful to those who want to see a lower initial mortgage payment as they get set up in their new home. “Supporting homeownership remains a key priority for us, and the valued advice of mortgage brokers will help borrowers understand which is the right option for them to achieve their homeownership goals.”

To access Own New Rate Reducer, clients can converse to the groups at Barratt and David Wilson Homes to discover a home that’s available by way of the scheme. They will then be referred to one in all a community of specialist mortgage dealer companions, who will assist to progress their utility.

Own New was launched in 2022 and its Deposit Drop product has been serving to consumers within the North East and Yorkshire to purchase a brand new home with a 5% deposit since early 2023. It was based by Eliot Darcy, who got down to create a extra accessible system of mortgage lending after being pissed off when he purchased his first home. Despite having a steady earnings, he struggled to safe a mortgage, whereas associates with rich dad and mom loved a way more simple route to purchasing.

For extra data on the Own New Rate Reducer go to the web site at Own New.