New mortgages scheme offers buyers low rates

Barratt Developments Scotland has helped to launch a new mortgage scheme in conjunction with Own New which offers lower rates for new home purchases.

For some buyers with a high deposit or equity, rates below 1% could be available.

This would offer more power to consumers over their monthly outgoings.

The aim is to give many more people the confidence to make their first or next home move.

New Build developments include Burnside Riverside Quarter, Countesswells, Osprey Heights and Findrassie in the northeast and Moray.

The scheme has been launched by the housebuilder, which includes Barratt Homes and David Wilson Homes, as well as Halifax and Virgin Money.

The Own New Rate Reducer works by using incentive budgets which housebuilders offer to their customers to reduce their monthly mortgage payments over a fixed term.

For example, if the housebuilder offers a 5% incentive on a home, Own New Rate Reducer takes this sum and directly offsets it against the mortgage interest to reduce monthly payments.

Buyers can opt to spread the benefit across the first two or five years, depending on their lender’s criteria.

In addition to cutting monthly outgoings, the customer will pay more off the capital value of their mortgage because the interest charged on the loan is lower.

Independent financial advice must be sought from a regulated mortgage broker who has completed additional training to access this scheme.

Barratt Developments worked alongside Own New to design Rate Reducer and was the first housebuilder to launch the scheme.

Other developers signed up to take part include Persimmon, Taylor Wimpey, Bellway and Berkeley Homes.

Lenders Gen H, Furness

Building Society and Perenna have also confirmed they will soon be joining.

Steve Mariner, sales and marketing director at Barratt Developments, said: “We are helping more people to be able to afford a home.

“The scheme gives buyers the financial boost they need to get them on to the property ladder.”

Eliot Darcy, founder of Own New, said: “Our ethos is to make home ownership and mortgage lending in this country open to more people.

“Alongside the national lenders and housebuilders who have signed up to the scheme, we believe 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 were delighted to be joined by Halifax and Virgin Money.

“By working together, we are increasing mortgage lending opportunities and bringing the possibility of owning a new-build home to a wider range of buyers.

“This is just the product to stimulate the housing market and to give more people a helping hand.”

Craig Calder, head of secured lending at Virgin Money, said: “This first-ofits-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.”

Amanda Bryden, head of Halifax Intermediaries, said the product was “especially helpful to those who want to see a lower initial mortgage payment as they get set up in their new home”.

To access Own New Rate Reducer, customers will need to speak to one of the housebuilders taking part.

■ For more information visit ownnew.co.uk

CONFIDENCE: Barratt new builds at Countesswells and Osprey Heights are included in the scheme.