The mortgage price war for higher-LTV loans has intensified with Yorkshire Building Society launching a 3.78% two-year fixed rate mortgage for customers with a 5% deposit.

The mortgage, launched today, is available for borrowers with a 95% loan-to-value and has an £845 product fee.

In a further bid to minimise costs for first-time buyers, Yorkshire is also reducing two-year fixed rates for mortgage customers with 15%, 10% and 5% deposits.

Brendan Gilligan, mortgage product manager for Yorkshire Building Society, said: “We’re very pleased to launch this very competitive, sub-4% rate for borrowers who want to borrow 95% of the value of their home.

“As a financially sustainable mutual with no external shareholders, we want to help as many people as possible to buy their own home and first-time buyers are a key part of this.

“We understand the challenges of buying your first home and have cut rates across the higher loan-to-value brackets to assist first-time buyers as much as possible.”