Yorkshire Building Society launches lowest ever mortgage deal at 0.89%
The two-year discounted standard variable rate (SVR) mortgage is available to first-time buyers and those remortgaging looking to borrow up to 65% of the value of the property.
The new 0.89% product matches the Yorkshire’s SVR at a discounted level of 3.85% for two years before reverting back to the SVR which is currently 4.74%.
As this is linked to the SVR, this means if Yorkshire were to reduce its rate, borrowers would benefit, but equally, if the SVR increases, borrowers would find it more expensive.
Borrowers need to stump up a product fee of £1,495 or alternatively, Yorkshire also offers a £995 product fee on its 1.05% mortgage deal.
The mutual is also offering a joint-lowest fixed rate mortgage at 0.99% for borrowers with a 40% deposit.
It comes just a couple of days after digital-only Atom Bank pulled its record low five-year mortgage deal priced at 1.29%.
James Farrow, senior mortgage manager at Yorkshire Building Society, said: “We are very pleased to offer borrowers the lowest mortgage rate ever available.
“The cost of funding has fallen in recent weeks and as a financially strong building society with no external shareholders to satisfy we have the ability to pass this on to borrowers.”
Rachel Springall, finance expert at Moneyfacts, said: “It’s fantastic to see such low rates on offer from Yorkshire Building Society and the choice between variable or fixed deal will appeal to different types of borrowers. Those looking for more flexibility over the shorter term may prefer a discounted deal, but those looking for some security could choose the fixed rate.
“In such a low interest rate environment it would be ideal for borrowers to consider overpaying their mortgage. As with any option borrowers would be wise to weigh up the entire package before entering any arrangement.”