High street mortgage lenders have announced a series of additions and reductions to their 90% LTV mortgage rates, as well as some new limited-time exclusives.
Virgin Money has introduced a number of new products. First, there’s a five-year fixed rate at 1.79% up to 75% LTV, and second, a two-year fixed-rate 2.79% up to 85% LTV. Finally, Virgin has added a broker-exclusive 90% LTV two-year fixed rate at 3.29% which is only available to first-time buyers.
All three of these products come with a £995 fee, £1,000 cashback and are available for a limited two-week period.
Going one step further, Virgin has also reduced rates across its core residential mortgage range by 0.15%.
Finally, they have added two former first-time buyer 90% LTV exclusive offers into their core range, accessible by everyone. The first is a two-year fixed rate at 3.29%. The second, a two-year fee-saver product at 3.39%.
What’s a broker-exclusive mortgage?
When looking to secure a mortgage, you have the option of going it alone or appointing a mortgage broker, someone who can guide you through the process and negotiate on your behalf.
While some lenders like to offer their best mortgage rates to customers who already have savings accounts or current accounts with them, others prefer to work with brokers. To this end, they will offer great mortgage rates which are only available to brokers, not customers representing themselves.
Some lenders prefer the opposite and offer non-broker exclusives.
The main decision you need to make is whether or not you can navigate the mortgage process without professional help. Many people can and do, but they might not be aware that many brokers offer a no-fee model.
Virgin isn’t the only firm increasing its 90% LTV range. Metro Bank, one of the few high street lenders who have consistently offered 90% LTV, has reduced rates on its 90% LTV five-year fixed-rate mortgage range.
For those who are looking for a new mortgage, this reduction brings the rate to 3.39%. Those looking to remortgage can enjoy a reduced rate of 3.44%.
What does LTV mean?
LTV means loan-to-value. It’s a way for lenders to determine how much risk they are taking on by lending you the money. Put more simply, it represents the value of the money you’re borrowing compared to the value of the product (house) you are buying.
So, a 90% LTV mortgage simply means that the bank is lending you 90% of the home’s overall value. To secure it, you will need to make up the final 10% with your initial mortgage deposit.
But remember, while a higher LTV number does make the mortgage more accessible, it also means your monthly repayment costs will be higher. Make sure you’re going to be able to comfortably afford this for years to come before signing any contracts.