Nationwide Launch New Account

Nationwide building society is launching a new saving account, which will help first time buyers to apply for a mortgage with just a 5% deposit.

The Save to Buy is a regular savings account, which pays interest of 2.5% gross on balances of up to £20,000. After at least six months of saving a minimum of £50 a month, the saver is entitled to apply for one of Nationwide's 95% loan-to-value ratio mortgages. Up until now these have only been available to existing Nationwide mortgage customers who want to move home.

Nationwide currently offers a 95% loan fixed for three years at 6.29% and one fixed for five years at 6.89%. These rates will probably have changed though by the time any first time buyer qualifies to apply.

There are other benefits to those who take out a Nationwide 95% LTV mortgage including cash back ranging from £250 for those who save from £2,500 to £4,999 and £1,000 for anyone who saves £10,000 or more. Save to Buy customers will also qualify for any Nationwide first time buyer deals which are available at the time of application.