Its analysis shows 23 out of 40 mortgage best buy deals across fixed, variable and buy-to-let deals are provided by building societies – nearly a third higher than the 18 out of 40 best buy deals offered by building societies in 2008.
Average rates on building society best buy mortgages are currently 3.4% compared with 6.2% in 2008 and lower than the 3.81% in October 2012, when Funding for Lending started to take effect.
Building societies currently offering best buy deals include Marsden and Newbury for remortgages while Nottingham and Nationwide are competitive for fixed rates and Mansfield, Marsden, Hinckley & Rugby and National Counties are competitive for discounted rates. Coventry and Hinckley & Rugby also score well for variable rates.
Sean Oldfield, chief executive officer, Castle Trust said:
“The competitive position of building societies as real contenders to the banks is clear and they are proving to be innovative and responsive to market conditions.
“Increased availability of funds through the Funding for Lending scheme is helping to boost the mortgage market as a whole but there remains a real need for further innovation to help unblock the housing market in support of Government schemes such as FirstBuy and HomeBuy.”
Castle Trust’s Partnership Mortgages are for 20% of the value of an owner occupied home alongside a repayment mortgage of up to 60% from a traditional lender and a deposit of at least 20%. There are no monthly commitments on the Partnership Mortgage and Castle Trust will share 40% of any profit made by the homeowner when they sell or at the end of the mortgage term. The company will also share 20% of any the loss made on a home bought with a Partnership Mortgage.
Sean Oldfield continues:
“Many people, despite having good credit histories and sizeable deposits, are finding it difficult to secure mortgages. This is as a result of the banks’ desire to preserve capital. In the last five years, building societies have looked to offer a wide variety of innovative mortgage products that provide homeowners with a diverse range of financing options. Our Partnership Mortgage helps lenders overcome this issue so many more good quality customers can secure the mortgage they want.”
Funding for Partnership Mortgages will come through two investment products launched by the company, both of which can be taken out for terms of three, five or ten years, with investment from £1,000. The Castle Trust Income HouSA tracks any rise or fall in the Halifax House Price Index and it also pays an annual income of between 2% and 3%, depending on the term of the investment.
The Growth HouSA offers a gain of between 1.25 times and 1.7 times any increase in the Halifax House Price Index or a loss of between 0.75 times and 0.3 times any decline.
