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No products on the table yet for NewBuy launch

There were fears as Mortgage Strategy was going to press last week that lenders would not be ready to offer 95% LTV deals in time for today’s launch of the government’s NewBuy Guarantee scheme.

Last week none of the UK’s top six lenders could confirm that they would launch deals today.

Lloyds Banking Group, Santander, Nationwide, the Royal Bank of Scotland, HSBC and Barclays would not give a date when they would be ready to launch products.

It is believed that most of the top lenders will sign up to the scheme today but it is less clear how many will have products ready to offer.

Under the scheme, announced in the government’s housing strategy last November, lenders will offer 95% LTV mortgages for new-build properties against a mortgage indemnity guarantee funded jointly by builders and the government.

The rate charged for the mortgage is meant to be lower than those on offer for a 95% LTV mortgage.

A source close to the scheme says: “Lenders are bending over backwards to try and be ready for the launch but there is still a lot of work to do regarding their systems and the pricing of deals.

“How much lenders will charge for the products will differ from bank to bank as it will depend on their capital requirements. There is not going to be a common price, which means the deals will be competitive.”

A spokeswoman for the Council of Mortgage Lenders, which has developed the scheme in conjunction with the Home Builders Federation, says it cannot give specifics about how many lenders have signed up to the initiative until its official launch today.

However, a spokesman for HSBC tells Mortgage Strategy: “We will not be launching any products on Monday and are still considering our position regarding the NewBuy scheme.

“We have no definitive plans and are still in the process of seeing how we can work with it.”

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