Brokers have welcomed news that the Post Office, Santander and NatWest for Intermediaries are all launching new products under the second phase of Help to Buy.
Demand should be strong with one in four people actively seeking a mortgage only able to afford a 5% deposit, according to new research from the Mortgage Advice Bureau.
Santander has announced new competitive Help to Buy fixed and tracker rates available from 4.99% with a 5% deposit. The loans are available between 90% and 95% LTV.
The deals, available both through intermediary channels and direct, have no upfront booking fees and include free valuation and cashback on completion.
All products come with Santander's Homebuyer Solution as standard, which includes a free valuation plus £250 cashback, to help with the upfront costs of purchasing a property.
The products include:
Two-year fixed rate charging 4.99% with no fee.
Five-year fixed rate charging 5.49% with no fee,
Two-year variable rate tracker charging 4.99% with no fee.
Santander 123 Current Account customers who pay their monthly mortgage payment by direct debit will also receive 1% cashback on maximum monthly mortgage payments of £1,000.
Miguel Sard, head of Santander Mortgages, said: “The first phase of the Help to Buy scheme has already helped improve the flow of credit to good quality customers, and played an important role in helping both first-time buyers and homemovers looking to buy new build properties.
"This has seen a welcome return of some confidence back into the market."
The Post Office is joining Help to Buy Scheme with its financial services partner, Bank of Ireland UK.
It already offers a five-year fixed-rate charging 4.45% to 90% LTV.
The Post Office will also increase its number of branch mortgage specialists to 100, to cement its aim of becoming a top 10 mortgage provider.
John Willcock, head of mortgages at the Post Office, said: “Joining Help to Buy is the latest in a series of steps to affirm Post Office as the go-to mortgage provider for those wanting to get their first foot on the property ladder."
NatWest Intermediary Solutions will be launching its Help to Buy mortgage guarantee scheme products later this month.
With one in four buyers needing a 95% mortgage, demand for Help to Buy and other high-LTV products should be strong, said Brian Murphy, head of lending at MAB.
"Growing competition and new products are set to lift a burden from the Bank of Mum and Dad."
MAB's research also showed that 28% can only afford to buy or move with government help while 26% are relying on financial help from family.
Almost one in 10 homeowners wish Help to Buy had existed when they bought their first home.
Some 14% of existing homeowners relied on a mortgage of 95% or more to buy their first home, while 17% relied on financial help from friends and family.
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