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90 per cent loan from Mansfield

Mansfield Building Society has launched three new deals for loans up to 90 per cent of valuation for borrowers who do not have a substantial deposit or equity in their existing house.

One of the deals is a three-year discounted rate, which has a 1.64 per cent discount for three years, giving a  current pay rate of  3.95 per cent. The deal is available for loans up to £200,000 for properties in England and Wales. There is no arrangement fee, basic valuation is free and there is a  £250 contribution towards legal fees for house purchase. Remortgages benefit from free legal fees through Mansfield’s nominated solicitors or a £250 contribution if borrowers use their own solicitors.

An early redemption charge of 3 per cent of the original loan is made if borrowers repay their mortgage within the discount period, but the deal allows capital repayments of up to 10 per cent a year to be made in the  first three years without penalty.

Mansfield expects the product to be in demand due to the challenging economic environment, where the majority of competitive mortgage products can only be accessed by those with a substantial deposit or equity in their existing homes, It has also added a direct-only three-year discounted rate mortgage to 95 per cent LTV to its range, with a 0.79 per cent discount giving a current pay rate of 4.8 per cent.

Defaqto insight analyst for banking David Black says: “The Mansfield’s main opposition is the Newbury Building Society, which charges an initial rate of 3.95 per cent for loans up to 95 per cent LTV after a 0.5 per cent discount, with a choice of either three or five years. But it is only available in a restricted geographical area. Like the Mansfield, it does not charge an arrangement fee, but the Mansfield scores by offering valuation and legal fee incentives.

“Another to consider is Penrith Building Society’s 3.65 per cent initial rate after a 0.5 per cent discount for five years. At 90 per cent LTV, it is only available on properties in Cumbria and has no arrangement fee, but does not offer any legal or valuation fee incentives.”

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