What is the Own New Rate Reducer Scheme?
A new build home is a property that has never been lived in before, built to modern specifications and energy efficiency standards. The Own New Rate Reducer is a fantastic scheme designed to make buying a new build home more affordable by lowering your mortgage payments in the early years. By using a developer’s incentive, this scheme helps reduce your monthly mortgage costs, so you can enjoy your new home without the stress of high payments.
For example, with Own New Rate Reducer on properties at Hurstwood Homes, you could enjoy rates as low as 2.74%. This could mean significant monthly savings:
- Reduced monthly payments for 2 or 5 years
- Potential savings of up to £497 per month on your mortgage*
- Lower interest rates starting from 0.99% (with 60% LTV)
Eliot Darcy, founder of Own New explains that “Monthly cost is a big issue for people, not just when interest rates are high, as it doesn’t look like rates are going to go down to where they used to be. It’s a problem for people and people want lower monthly payments, and ultimately, that’s what Rate Reducer does”. Read more from Eliot Darcy here.
How Does It Work?
It’s simple! Here’s how the scheme works:
1. Developer Contribution: The home-builder (us!) will contribute 3% or 5% of the home’s price to lower your mortgage interest rate. This means you pay less each month.
2. Lower Interest Rates: With this contribution, your mortgage rate is reduced for an initial term of either 2 or 5 years, depending on the option you choose. This helps keep your payments lower during the first few years of your mortgage.
3. After the Fixed Rate: Once your fixed-rate term ends, you’ll either need to re-mortgage onto a new deal or move onto your lender’s standard variable rate.
4. Mortgage Rates: For example, with a 60% loan-to-value (LTV) mortgage, rates can start as low as 0.99% for a 2-year fixed deal. Even if your LTV is higher, you’ll still benefit from significantly lower rates than the open market.
Who Can Benefit from the Scheme?
To qualify for the Own New Rate Reducer, you need to:
- Meet standard mortgage lending criteria (including credit score and affordability assessments)
- Have a minimum deposit (typically 5-10% depending on the lender)
- Purchase a qualifying new build property
- Use a participating mortgage lender
The scheme is available to:
- Previous property owners
- First-time buyers
- Home movers
As long as you’re buying a new build home, you can take advantage of this scheme!
Available Now at Hurstwood Homes
The Own New Rate Reducer is currently available on all properties at Hurstwood Homes. Here's a practical example of potential savings:
Ex.
Property price: £595,000
Mortgage term: 35 years
Monthly savings: Up to £497*
Use the Rate Reducer Calculator to calculate your potential savings
Why Should You Consider the Own New Rate Reducer?
- Lower monthly mortgage payments during the first few years make owning your new home more affordable.
- Our contribution directly lowers your mortgage interest rate, meaning more money stays in your pocket each month.
- You’ll be able to pay off more of your mortgage’s principal early, helping you build equity in your home faster.
Benefits of Own New Rate Reducer
- Lower monthly mortgage payments during the crucial first years of homeownership
- Direct interest rate reduction through developer contribution
- Faster equity building through higher principal payments
- Available on a wide range of property types and values
Application Process Timeline
- Speak with an independent, regulated mortgage broker
- Choose your dream home at Hurstwood Homes
- Complete mortgage application with your chosen lender
- Property valuation and legal processes
- Exchange contracts and complete purchase
Frequently Asked Questions
- Can I combine this with other schemes? Consult your mortgage advisor about combining Rate Reducer with other available schemes.
- What happens after the fixed-rate period? You'll need to either remortgage or move to your lender's standard variable rate. Start discussing options with your advisor 3-6 months before the fixed term ends.
- Are there any early repayment charges? These vary by lender - your mortgage advisor will explain any applicable charges.
Get Started
Ready to make your dream home a reality? Follow these steps:
- Book a viewing of your chosen property
- Browse available properties at Hurstwood Homes
- Contact an independent, regulated mortgage broker
- Calculate your potential savings using the Rate Reducer calculator
Introducing Own New Rate Reducer Mortgage Porting
Halifax has extended its offering with Own New to include mortgage porting for new build homes. If you are looking to purchase a new build home, you can now port your existing Halifax mortgage to your new home and if top-up borrowing is required, you can access lower Rate Reducer rates and enjoy a big chunk of cashback on top!
What this means for new home buyers:
- Keep their existing Halifax mortgage rate
- Benefit from lower rates on any additional borrowing for a new build
- Receive cashback on top of their savings when porting to a new build property!
This new feature provides buyers with more options when porting their mortgage to buy a new build home, making it easier to secure the best rate and minimise additional costs.
Find your dream home now without the worry of additional charges!
*Example based on market interest rates, with an average house price of £595,000 and an average mortgage term of 35 years. Assumes a 3% homebuilder incentive and a 2 year fix, with 75% LTV mortgage. Independent financial advice must be sought from a regulated mortgage broker to access this scheme. Your home may be repossessed if you do not keep up your mortgage repayments. Rates valid as of 01-11-2024
