"With the homebuilders' incentive included, they have the certainty of a much lower fixed interest rate over the initial period of the mortgage."
- Craig Calder, head of secured lending at Virgin Money
Virgin Money has announced that it is expanding the distribution of Own New's new ‘Rate Reducer’ product.
The Own New Rate Reducer mortgage is available to anyone purchasing a new build property, including both first-time buyers and home movers. It launched to market last month via Virgin Money and Halifax, with Gen H, Furness Building Society and Perenna confirming they will soon be offering mortgages through the scheme.
Where builders usually offer incentives like upgrades or cashback, with the Rate Reducer product they invest this back into the mortgage to help lower the interest rate during the fixed rate term.
Own New Rate Reducer Mortgage is now available for over 60 builders, including Barratt Homes, Persimmon, Taylor Wimpey, Bellway and Berkeley Homes.
Rates start from 0.99% for a two-year fixed rate at 60% LTV and 1.83% at 75% LTV.
Five-year fixed rates are available from 2.95% at 60% LTV, 3.37% at 75% LTV and 3.78% at 90% LTV.
All products come with a £495 fee and £250 cashback, all with a 5% builders’ incentive.
The range is available to experienced new build brokers, who will also need an accreditation with Own New.
Standard new build policy and affordability assessments will apply and cases can submitted using Virgin Money Online by selecting the Own New payment route.
Craig Calder, head of secured lending at Virgin Money, said: “Virgin Money is 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 with the homebuilders' incentive included, they have the certainty of a much lower fixed interest rate over the initial period of the mortgage.”
