Which mortgage providers have shone brightest, been truly innovative and given outstanding service in the face of ever challenging market conditions?
The competition was fierce, as always, but the results are finally in – here are the winning lenders in the USNewsRank Mortgage Awards 2019
Brits are property obsessed. We watch people buy, sell and renovate their homes on TV, and check out what our neighbours’ properties have sold for online. And when the conversation runs dry after we’ve exhausted the state of the weather, there’s always the state of the property market to fall back on.
But for many people the reality of buying and financing property can be pretty stressful. From difficult buyers to tardy solicitors or problematic surveys there is often something that throws a spanner in the works.
However, with the right mortgage from the right lender, financing your property purchase shouldn’t be an additional headache.
Whether you are buying your first home or your last home, purchasing an investment or want to get a better deal on your current loan, the USNewsRank Mortgage Awards are here to help you find the right lender for you.
Across 12 categories, our awards go to lenders who don’t just offer excellent rates, they also provide top-notch customer service and strive to come up with the solutions to better tackle your borrowing needs.
Best lender for fixed rates
- Top deal: 1.84% five-year fix
- Max LTV: 60%
- Fee: £999
Highly commended: Barclays
Fixed rate mortgages offer you the certainty that your mortgage payments will not rise during the specified period, irrespective of what happens to interest rates. Deals are typically for two or five years, but longer term 10-year deals are also available.
With interest rates remaining low since the 2008 financial crisis, borrowers have become used to cheap mortgages and are wary of rates rising. With this in mind, it’s not surprising that the vast majority of borrowers now take out this type of mortgage and competition between lenders is fierce.
Our winner for the third consecutive year is HSBC. David Hollingworth, judge and associate director, communications at London & Country says: “The consistency of its pricing is hard to ignore and puts it at or near the top of the best buy charts, week in week out. It’s not just at low LTV [loan-to-value] bandings either; it also adds to the strength of its offering with free valuation and free basic legal work for remortgages as standard.”
For the second year in a row, our runner-up is Barclays. Judge Andrew Montlake, director at mortgage broker Coreco says:
“It has been consistent all year with good rates.”
Judge Cassie Stephenson, vice president operations at Habito meanwhile noted that it is particularly competitive in the help to buy market.
Best lender for discount mortgages
Winner: Accord Mortgages
Highly commended: Leeds Building Society
Fixed rates might be the preferred choice of most borrowers, but there is still a market among some borrowers for discounted rates. These offer a discount from the lender’s standard variable rate but as the rate is not fixed it may change if interest rates rise or fall.
Our winner this year is Accord – the broker-only subsidiary of Yorkshire Building Society, which won the same category in 2018. Judge Aaron Strutt, product and communications manager at Trinity Financial Services says: “Accord has offered some incredibly cheap discounted mortgage rates over the past year, undercutting the price of many fixed deals. They have been available to a wide range of borrowers, and these mortgages complement the overall suite of products. Most borrowers do not think about discounted rates because they typically take a fixed rate but they can be an attractive option.”
He adds: “Accord’s discounted mortgages have also been designed so borrowers can lock into a fixed rate at any point without paying an exit fee.”
Coming in a close second place is Leeds Building Society. Mr Hollingworth says: “A thorough range of competitively priced discounted rates on offer in the core areas. It typically offers a range of fee options to broaden the suitability to a wider audience.”
Best lender for offset mortgages
Winner: Scottish Widows Bank
- Top deal: 1.99% five-year fix
- Max LTV: 60%
- Fee: £1,499
Highly commended: Accord Mortgages
Offset mortgages enable you to use any savings you might have to reduce the level of interest you pay on your home loan. So, for example, if you had a £100,000 mortgage, linked to £25,000 in savings, you would only pay interest on the difference – £75,000. This can save borrowers thousands of pounds, either by reducing monthly repayments or by repaying their mortgage early. Mr Strutt says: “If more people were aware of the benefits of offset mortgages they would be tempted to take them rather than leaving cash in savings accounts generating small returns. There are lots of calculators online that can demonstrate how they work and how much you could save.”
Not only does Scottish Widows Bank take the award for an impressive fifth year in a row, it was also the unanimous choice of our judges. Mr Montlake says: “They have been brilliant all year with low rates and a good offset offering, especially on remortgages. So good I remortgaged to them myself!”
Mr Hollingworth adds: “It’s unique in making offset standard across the entire range and has been highly competitive at times. Famously flexible for higher earners, Scottish Widows’ proposition is very well structured for their target market.”
Our runner-up is Accord Mortgages. Mr Strutt says: “Accord has had a real push on its offset proposition, making it more widely available to borrowers including first-time buyers. Brokers are turning to the lender because it consistently offers mortgages when other banks or building societies have refused applications.”
Best lender for buy to let
- Top deal: 1.47% two-year fixed rate
- Max LTV: 65%
- Fee: £1,795
Highly commended: The Mortgage Works
As rules and regulations become increasingly punitive for landlords, it’s becoming even more important for landlords and property investors to make sure they are on the most competitive rate possible and working with a lender that can help them navigate the market.
For the second year on the bounce the award goes to Barclays. Mr Hollingworth says: “Barclays is a great example of what can be achieved by looking beyond conventional wisdom. Its full affordability assessment underwrites the borrower rather than the property, which makes them particularly good for smaller-scale landlords in high-value areas who might otherwise struggle to meet pure rental tests. Good product pricing and incentives add up to a compelling offer.”
This year the runner up is The Mortgage Works (TMW) – the specialist lending arm of Nationwide Building Society. Mr Hollingworth says: “TMW is a major buy-to-let player but has not rested on its laurels and continues to develop and enhance its proposition. TMW’s launch into the limited company buy-to-let market has helped to shake that market up but it continues to look after the smaller landlords too. Higher 80% LTV options, strong incentives, a wide range of fee options and competitive rates make for an excellent overall package.”
Best lender for first-time buyers
- Top deal: 1.99% two-year fixed rate
- Max LTV: 90%
- Fee: £999
Highly commended: Halifax
Getting on to the property ladder can feel like something of a Herculean feat, and it helps when lenders can take a practical, sensible approach. This award is for those lenders that go above and beyond to help people buy their first home.
Once again it was very much a two-horse race, with high street giants Nationwide and Halifax taking first and second place as they did in our 2018 awards.
Commenting on our winner, Nationwide, Mr Strutt says: “Nationwide has made a strong commitment to first-time buyers to help them on to the property ladder. The lender has higher loan-to-value mortgages and provides terms of up to 40 years. At the moment it is taking an average of 10 days to produce mortgage offers and does not charge a valuation fee if you are purchasing a property and require a basic inspection.”
He adds: “Last year the lender increased its 95% loan-to-value loan size twice from £350,000 to £500,000 to make it easier to purchase property typically in London and the South East. It had already raised this limit from £250,000 to £350,000.”
Ms Stephenson says our runner-up, Halifax, is “good on affordability and offers a very quick turnaround time from application to offer”. Mr Montlake says it’s “always consistent, always reliable, the first-time buyer’s dream”.
Best lender for first-time buyers with family support
- Top deal: 2.75% three-year fix (Family Springboard, which requires a family member to pay 10% of the purchase price into a linked savings account for three years)
- Max LTV: 95%
- Fee: £0
Highly commended: Bath Building Society
With increasing numbers of first-time buyers turning to parents and other family members for help in buying their first home, this award is for those lenders that have developed products to specifically target this market and incorporate financial support from a third party in its affordability calculations.
The award this year goes to Barclays – last year’s runner-up. Mr Hollingworth says: “Barclays has supported the Family Springboard product approach consistently, now offering deals all the way up to 100% LTV when a parent is able to support their child with 10% in cash as additional security. From the parents’ point of view it offers interest on the cash and access to their savings after three years.”
Runner-up this year is Bath Building Society, which has been offering its Parent Assisted Buying Scheme since 2008. It also offers loans to help university students purchase property. Mr Montlake describes the lender’s approach as “original and innovative”.
Best lender for lifetime trackers
Winner: First Direct
- Top deal: 2.74% (1.99% over BoE base rate)
- Max LTV: 75%
- Fee: £490
Highly commended: Santander
If you don’t want the hassle of remortgaging every few years and can cope with your mortgage repayments changing, it may make sense to go for a lifetime tracker. Rather than offering a fixed or discounted rate for a set period of time, these mortgages are set at a certain margin above the Bank of England base rate and move up and down when it does.
Unlike fixed and discount deals that tie you in for a certain period of time, there are not usually any penalties for switching.
For the second year in a row, the award goes to First Direct. Mr Strutt says: “First Direct is one of a limited number of lenders happy to provide Bank of England base rate tracker mortgages that are competitively priced with very low arrangement fees.
“The bank still has a great reputation for customer service and its products are available providing you have a 10% deposit. There are also a few offset rates.”
Taking the runner-up position is Santander. Mr Hollingworth says: “Santander is very good at targeting its products well and with good incentive packages to bolster the rates on offer.”
Best lender for remortgages
- Top deal: 1.85% five-year fix including free valuation and legals
- Max LTV: 60%
- Fee: £999
Highly commended: HSBC
When you come to the end of the fixed or discounted rate on your mortgage, you’ll be switched to your lender’s standard variable rate and your monthly repayments will skyrocket.
However, you can avoid this by remortgaging to a better deal. Once you have come off your special rate there aren’t usually any penalties for switching. There will be arrangement fees on your new loan but these will be more than outweighed by the savings you make on lower repayments.
Taking the award once again is Barclays – the same winner as last year. Mr Strutt says: “Barclays is extremely active in the remortgage market and has an attractive proposition to tempt borrowers away from their existing lenders and avoid expensive standard variable rates.
“The bank has some great rates, low arrangement fees and generous affordability calculations, and even contributes to the valuation and legal costs of remortgaging. It can also provide a super-fast mortgage if you have a large deposit.”
Coming a very close second is HSBC, which was also runner-up last year.
Mr Hollingworth says: “HSBC is impossible to ignore, with consistent market-leading rates on offer and remortgage incentives across the board.
“The key areas of two and five-year fixes as well as two-year trackers have all been covered, making for a great remortgage option.”
Best lender for larger loans
- Top deal: 1.49% two-year tracker (0.74% over base rate)
- Max LTV: 75%
- Fee: £999
Highly commended: NatWest
It’s crazy to think that wealth can hinder your ability to borrow, but the reality is borrowers in need of larger loans could see their options limited. It may be that they exceed the maximum loan size for the most competitive deals, or find that income from multiple sources complicates affordability assessments.
Our winner this year is HSBC, which was highly commended in this category last year.
Mr Strutt says: “HSBC has a wide selection of rates available to wealthier clients living in the UK and overseas. It also has a decent interest-only policy enabling clients to minimise their monthly payments.
“When people require larger loans they also often want a lender to make it as easy as possible to get agreed and the ability to be flexible when required. HSBC provides larger loans on its cheapest fixed and tracker rates and even has no early repayment charge trackers.”
NatWest is runner-up this year. Mr Strutt says: “NatWest offers multi-million-pound mortgages on its cheapest fixed rates as standard and has teams dedicated to producing fast mortgage offers. It can help a wide range of wealthy clients with unusual properties or complex financial situations. The bank has established itself as one of the go-to lenders for larger loans and is keen to help more people.”
Best lender for new-build
- Top deal: 2.54% two-year fix with £1,000 cashback
- Max LTV: 90%
- Fee: £0
Highly commended: Halifax
If you are buying a new-build home, it can help to have a sympathetic lender. The property may not be fully built at the point you apply for your mortgage, or you might find that your developer imposes tight deadlines that require speedy action from your lender.
Our winner this year is Barclays. Mr Hollingworth says: “Barclays has been really strong in the new-build market and notably developed its Green Home mortgage – specifically designed to recognise the fact that new homes often offer better energy efficiency.”
Last year’s winner, Halifax, is runner-up this year. Mr Strutt says: “Halifax is good on affordability and regularly provides fast mortgage offers to help with tight exchange deadlines set by developers. Having a soft credit footprint at the initial dip stage is a comfort as many buyers are very concerned about their credit scores.”
Best lender for older borrowers
Winner: Family Building Society
- Top deal: 2.69% two-year fix
- Max LTV: 80%
- Fee: £999
Highly commended: Hodge Lifetime
Strict lending criteria and maximum age caps can make it difficult for older borrowers to take out a mortgage.
However, with more lenders increasing age caps, and taking a more pragmatic approach to underwriting and developing loans specifically for this market, the picture is improving.
For the second year in a row, the award goes to the Family Building Society.
Mr Strutt comments: “Family Building Society helps a lot of older borrowers and has acceptance criteria that is designed to make it easier to qualify for a mortgage if you have pension or investment income.”
Mr Hollingworth also points to the society’s Retirement Lifestyle Booster – a loan linked to your home that enables you to boost your income over a 10-year period – as an indication of its ability to innovate and respond to the needs of its target market.
Coming a very close second is Hodge Lifetime.
Mr Hollingworth says: “Hodge is a specialist in the equity release market and the company has brought that experience to bear well in the mortgage market. It already offered a mortgage product for those who are aged 55-plus but it has been quick to add a retirement interest-only option following the regulatory change.”
Innovator of the year
- Top deal: Green Home Mortgage 2.13% two-year fix
- Max LTV: 90%
- Fee: £0
Lenders continually develop new products and services to improve their customer proposition. However, it’s often difficult to distinguish between marketing gimmicks and genuine innovation. This award rewards those lenders that are genuinely responding to the needs of their target market.
This year our winner is Barclays, which is helping the ever growing new-build market with its Green Home Mortgage.
“It rewards buyers of energy efficient homes with a keener rate,” explains Mr Hollingworth. “A nice idea to put the focus on energy efficiency, something that will be a strength of new-build.”
The mortgage is open to people buying a new-build from a range of developers with an energy efficiency rating of 81 or above or which is in an A or B band with discounts on its fixed rate mortgages.
USNewsRank Mortgage Awards 2019 were judged by:
David Hollingworth, associate director, communications at London & Country
Andrew Montlake, director, Coreco
Aaron Strutt, product and communications manager at Trinity Financial
Cassie Stephenson, vice president operations, Habito
Trinity Financial compiled our shortlists, based on best buy data over 12 months (supplied April 2019). Shortlists of lenders with the best rates were given to the judges, who voted for winners and runners-up, looking at rates, fees, penalties, flexibility, service and treatment of new and existing customers. Judges voted for their innovator of the year, but the USNewsRank editorial team made the final decision.
- Home & mortgage