Get a best buy mortgage

It's been a busy week in the mortgage market, with new best buy deals for first-time buyers, borrowers with large deposits, and a mortgage allowing you to fix your rate for a decade at less than 5%.

The housing market may be at its quietest level in 40 years, but mortgage lenders have been busy, launching all sorts of new mortgages for a range of different borrower types.

Have a look at the deals we’ve found and decide which mortgage is right for you.

First-time buyers

Last week saw two pieces of good news for first-time buyers. Firstly, the Government announced a £400m property initiative which will help borrowers with just a 5% deposit.

Basically, the government has said it will join forces with the country's house builders in offering special indemnity insurance to the UK's mortgage lenders. In return, lenders must provide 95% loan to value (LTV) mortgages to up to 100,000 potential buyers of newly-built properties.

The second bit of good news is that HSBC has launched its first ever sub 4% interest rate for mortgage borrowers with a 10% deposit – a 3.84% two-year discount deal with no fees.

It’s not the only lender going below 4% for 90% LTV mortgages though. Leek United building society currently has a three-year fix at 3.99% with a £995 fee. For more on the HSBC deal, and other mortgages for borrowers with small deposits, check out A great new HSBC mortgage for first-time buyers.

Big deposits

HSBC has got some pretty decent rates for borrowers with a bigger deposit too. Other new products the bank launched this week include a 2.39% lifetime tracker at 60% LTV. The deal comes with a £999 booking fee.

Alternatively HSBC has a two-year discount rate at 1.99% but you’ll need a 40% deposit and £999 up front.

If you don’t fancy a discount rate Santander has two-year tracker with an initial pay rate of 2.09%. It requires a 40% deposit though and comes with a hefty £1,995 fee.

If you’ve got a big deposit or amount of equity and want to fix for five years, HSBC has a five-year fix at 3.28% available up to 60% LTV. It comes with a massive £1,999 fee though so you’ll need to do the sums to work out if it’s worth paying a big fee to get the low rate.

If you’re after a five-year fix, but don’t have 40% equity, then Chelsea Building Society is offering a five-year deal at 3.29%. It’s available at 75% LTV and has a £1,495 fee.

10-year fix

If you’re thinking long-term it’s now possible to fix your mortgage for a whole decade at less than 5%. Leeds Building Society has reduced the rate on its 10-year fixed rate mortgage by 1% to a market-leading 4.99%.

You’ll be eligible up to 80% loan-to-value (LTV) and you can overpay 10% of the capital each year without penalty. The deal is fully portable too.

Falling rates

Last week saw Nationwide cut the rates on some of its products. Its five-year fixed rate is now available at 4.49%, a cut of 0.15%. It’s available up to 85% LTV and comes with a £900 product fee and £99 booking fee for movers and remortgagers while first-time buyers get a £500 discount on the fee.  

Nationwide also cut its three-year tracker rate to 3.59%. It’s also available up to 85% LTV and has a £900 product fee and £99 booking fee for house purchase and remortgage customers. Again, first-timers get a £500 discount on the product fee.

Deposits and choice

Despite new Government plans to slash deposit requirements to 5%, at the moment the situation remains that saving up a deposit remains the biggest issue for most potential homeowners.

Most competitive deals are only available to those with a minimum 25% deposit or equity in a home.

Data compiler Moneyfacts says the number of loan deals for those with a small deposit has increased in the past year, but remains stubbornly low.

Borrowers with a 10% deposit have a choice of just 253 different deals compared with 1,200 for those with 25% or more. And borrowers with less than 10% deposit have a choice of fewer than 40 different deals!

15 tremendous mortgages for everybody

More: A great new HSBC mortgage for first-time buyers | Get the best rate on your remortgage