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| Version 1 | Version 2 |
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| Santander signs up to Help to Buy | Santander signs up to Help to Buy |
| (30 days later) | |
| The government's Help to Buy scheme has received a further boost after Santander announced it is offering a range of mortgages aimed at homebuyers who cannot afford a large deposit. | The government's Help to Buy scheme has received a further boost after Santander announced it is offering a range of mortgages aimed at homebuyers who cannot afford a large deposit. |
| The bank said it had signed up to the first part of Help to Buy, which went live in April and allows buyers looking to purchase a new-build home to take out a mortgage for just 75% of the cost of the property provided they can manage a 5% deposit. | The bank said it had signed up to the first part of Help to Buy, which went live in April and allows buyers looking to purchase a new-build home to take out a mortgage for just 75% of the cost of the property provided they can manage a 5% deposit. |
| Those who qualify, who can be either first-time buyers or those looking to move up the property ladder, are eligible for an "equity loan" worth up to 20% of the value of the property, funded by the government, which is interest-free for the first five years. | Those who qualify, who can be either first-time buyers or those looking to move up the property ladder, are eligible for an "equity loan" worth up to 20% of the value of the property, funded by the government, which is interest-free for the first five years. |
| The Spanish-owned bank joins Halifax, NatWest, Barclays (via its Woolwich arm) and Nationwide, plus a handful of smaller building societies, in offering Help to Buy mortgages. | The Spanish-owned bank joins Halifax, NatWest, Barclays (via its Woolwich arm) and Nationwide, plus a handful of smaller building societies, in offering Help to Buy mortgages. |
| Santander's range includes a two-year fixed-rate deal priced at 3.29%, a five-year fix at 3.49%, and a two-year base rate tracker where the initial rate is 3.29%. The deals require a minimum deposit of 5% and are available via the bank's broker arm Santander for Intermediaries. They have no upfront booking fees and come with a free valuation and £250 cashback, thereby helping customers with the upfront costs of purchasing a property, the bank said. | Santander's range includes a two-year fixed-rate deal priced at 3.29%, a five-year fix at 3.49%, and a two-year base rate tracker where the initial rate is 3.29%. The deals require a minimum deposit of 5% and are available via the bank's broker arm Santander for Intermediaries. They have no upfront booking fees and come with a free valuation and £250 cashback, thereby helping customers with the upfront costs of purchasing a property, the bank said. |
| Phil Cliff, director of mortgages at Santander, said the scheme "will play an important role in helping both first-time buyers and home movers looking to buy new-build properties". | Phil Cliff, director of mortgages at Santander, said the scheme "will play an important role in helping both first-time buyers and home movers looking to buy new-build properties". |
| David Hollingworth at mortgage broker London & Country said Santander's decision to join Help to Buy was very welcome, and that the rates on the scheme's mortgages had generally been improving. | David Hollingworth at mortgage broker London & Country said Santander's decision to join Help to Buy was very welcome, and that the rates on the scheme's mortgages had generally been improving. |
| The equity loans part of the Help to Buy scheme is designed to help people buy a new-build home with a lower deposit than a lender would normally require, and will run for three years and help up to 74,000 buyers, according to the Treasury. The government said recently that the scheme had been "an instant hit", with almost 7,000 reservations supported by it in its first three months, and more than 1,000 sales completed. | The equity loans part of the Help to Buy scheme is designed to help people buy a new-build home with a lower deposit than a lender would normally require, and will run for three years and help up to 74,000 buyers, according to the Treasury. The government said recently that the scheme had been "an instant hit", with almost 7,000 reservations supported by it in its first three months, and more than 1,000 sales completed. |
| The second part of Help to Buy involves the introduction of a "mortgage guarantee" to enable more people to obtain a home loan without the need for a prohibitively large deposit. | The second part of Help to Buy involves the introduction of a "mortgage guarantee" to enable more people to obtain a home loan without the need for a prohibitively large deposit. |
| The government will make available £12bn of guarantees to lenders, which it said should be enough to support £130bn of high loan-to-value (LTV) mortgages. This scheme will run for three years from January 2014 and see the government give lenders who offer mortgages to people with a deposit of between 5% and 20% the chance to buy a guarantee on the high LTV portion of the mortgage. This means that if a borrower's property were to be repossessed, the government would cover a chunk of the losses suffered by the lender. | The government will make available £12bn of guarantees to lenders, which it said should be enough to support £130bn of high loan-to-value (LTV) mortgages. This scheme will run for three years from January 2014 and see the government give lenders who offer mortgages to people with a deposit of between 5% and 20% the chance to buy a guarantee on the high LTV portion of the mortgage. This means that if a borrower's property were to be repossessed, the government would cover a chunk of the losses suffered by the lender. |
| However, it remains to be seen how much lenders will have to pay for the guarantees, and how competitive the mortgage deals will be when they become available in January. | However, it remains to be seen how much lenders will have to pay for the guarantees, and how competitive the mortgage deals will be when they become available in January. |
| Top mortgages | Top mortgages |
| HSBC | HSBC |
| HSBC | |
| HSBC | HSBC |
| Provided by London & Country for the Guardian | Provided by London & Country for the Guardian |