The bank follows, Aldermore, Bank of Scotland, Virgin Money, Halifax, HSBC, NatWest/RBS and Santander to launch new deals as part of the government’s Help to Buy mortgage guarantee scheme, phase two. The new mortgages will land on Tuesday, January 21.
What’s Help to Buy?
It’s the government’s big idea to help people who can’t afford large deposits to move along the property ladder. The first ‘equity loan’ phase of Help to Buy was only available to new-build buyers, whereas the second phase – the mortgage guarantee – is available to any borrower looking to buy any property, worth up to £600,000.
With the mortgage guarantee phase of Help to Buy, the government guarantee a further 15% of a property’s value, in return for a fee from the lender. This gives banks and building societies the security to lend larger mortgages, and allows them to help those with smaller deposits of between 5% and 10%.
Andy Gray, managing director of mortgages for Barclays, said: “We’re pleased to be joining the Government’s Help to Buy mortgage guarantee scheme and supporting first-time buyers and home movers get on, or move up, the housing ladder. This builds on our existing and on-going participation under the Help to Buy equity scheme.
“We have two products and these have been developed to offer extra customer choice for those with deposits from 5%, and build upon the success of existing schemes such as the Barclays Family Springboard mortgage.”
The only other lender offering a three-year fix under Help to Buy phase two is Virgin Money, which is charging 5.39% with no upfront fees. At 5.35% (and also with no fees), Barclays trumps Virgin in terms of rate – but Virgin’s deal throws in £300 cashback to help with legal and valuation fees.
In terms of five-year fixed rate deals, Barclays’ 5.49% deal is pretty evenly matched by Virgin Money (5.49%), and Santander (5.49%) but, again, it doesn’t match their cashback incentives.
For more information on Help to Buy, see our dedicated first-time buyer hub.
Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.