29th May 2015
TSB has launched a new range of mortgages that start with a lower interest rate to give new homeowners ‘breathing space’.
In the fierce battle between lenders that has seen mortgage rates drop dramatically, TSB has come up with another twist.
It’s new ‘breathing space mortgages’ will charge a lower interest rate for the first year to ‘help customers wanting to put their own stamp on their new pad’.
The idea behind the mortgage is to give borrowers spare money to pay for the additional outgoings that come with homeownership in the first year such as decorating and buying white goods, and reverts to a higher rate for the second and third years of the mortgage.
Those with an LTV of 75%-80% will receive a 1.49% rate for the first year and 2.59% for years two and three. Those with an LTV of 80% to 85% will pay 1.84%, increasing to 2.94%.
For those with 85% to 90% LTV, the rate starts at 2.99% and increases to 4.09% and for those with 90% to 95% LTV the rate starts at 3.59% and increases to 4.69%.
The mortgages are available to first time buyers and those wishing to move home.
Ian Ramsden, director of mortgages at TSB, said: ‘We know the first year after moving can often be expensive as people make their house a home. Offering homebuyers some breathing space on their mortgage during the first year will give them the support to achieve this.
‘Helping people get a foot onto the property ladder is a fundamental part of creating thriving local economies, and people thriving across the country is what we call, local banking for Britain.’