Questions will continue to be raised over the purpose of the Help to Buy scheme as small regional lenders continue to offer cheaper 95% LTV mortgages under their own steam.
Monmouthshire Building Society has just opened its 95% LTV range, previously only available direct, to intermediaries as well.
With variable rates starting at just 3.75%, it is more 100 basis points cheaper than the best 95% mortgage available through Help to Buy.
Monmouthshire offers a discount of 1.24% off its standard variable rate of 4.99%, giving a pay rate of 3.75% in the first three years of the loan.
At the end of that term, the deal will revert to the society's SVR. There is no product fee and no early repayment charges.
The loan is available for mortgages between £40,000 and £175,000.
Monmouthshire will only lend in its local geographical area, defined as postcode areas: NP, CF, SA, LD, WR, GL, HR and BS.
Hanley Economic Building Society has also undercut Help to Buy rates, using private insurer Genworth.
But it does raise the question of how smaller regional building societies using their own private insurance schemes can offer cheaper 95% LTV deals than massive high street lenders on government support.
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