Buyers who save reaping mortgage benefits with Nationwide

  • Five years since Nationwide launched Save to Buy – forerunner of Help to Buy ISA 
  • More than £1.3 billion loaned to Save to Buy mortgage customers for 8,500 homes
  • 107,000 Save to Buy ISAs and Savings Accounts opened in the scheme’s lifetime 

The benefits of saving for a deposit before applying for a mortgage have been highlighted by figures from Nationwide’s long-running Save to Buy savings-to-mortgage scheme, which marks its fifth anniversary today (16 May 2016).

Save to Buy, launched in May 2011, provided the model for the Help to Buy ISA. It was closed to new customers when Nationwide launched its Help to Buy ISA on 1 December 2015. However, Nationwide’s Help to Buy ISA continues to combine all the benefits of Save to Buy, plus the additional Government bonus when purchasing a first home. Customers also have access to Nationwide’s flexible ISA approach, which allows savers to hold more than one Nationwide cash ISA product in its ISA wrapper. Help to Buy ISA savers can also access Save to Buy mortgage benefits, including discounted mortgage rates and additional cashbacks of up to £1,000.

What the Nationwide statistics, detailing the success of Save to Buy, demonstrate is the positive impact that planning to save can have on a first time buyer’s ability to successfully access a mortgage. They also give an indication of how those with a Help to Buy ISA may be similarly advantaged in future.

More than 8,500 homes have so far been purchased through Nationwide’s Save to Buy scheme. Around £1.3 billion has so far been loaned to those who have saved towards a mortgage deposit through a Save to Buy Savings Account or ISA and who have gone on to take out a Nationwide Save to Buy mortgage.

By the time the Nationwide Help to Buy ISA replaced it, 107,000 Save to Buy savings and ISA accounts had been opened, with an average account balance of £6,823, up from £5,714 the previous year.

Andrew Baddeley-Chappell, Nationwide’s Head of Policy for Mortgages and Savings, said: “Half a million people have opened a Help to Buy ISA to save towards a deposit on a home of their own. Nationwide’s own figures offer clear evidence that if first time buyers plan how to access a mortgage before finding a property, they are far more likely to be successful at securing both.

“Many people do not have the bank of mum and dad to depend upon. Whether through Nationwide’s Save to Buy scheme or now through the Help to Buy ISA, we have focussed our support on those who prudently plan ahead, save regularly and think about what they might need to apply successfully for a mortgage before finding a home. The figures underline how this pays off.”

In addition, the Nationwide figures showed:

  • The average loan size for Save to Buy mortgage applicants since launch, of which the vast majority are first time buyers, is £148,000.
  • The average deposit is £15,250.
  • On average, Save to Buy first time buyers are aged 29, down from 32 in 2015.
  • Four fifths of Save to Buy mortgage applications are made in joint names.

“Such schemes are designed to enable mortgage applicants to demonstrate that, by making a regular commitment to save, they understand that good savings habits, money management and strong credit quality go hand in hand.” continued Andrew Baddeley-Chappell. “Through this approach, we have helped our customers to help themselves, so they can access low deposit mortgages and cashbacks to assist with the costs of moving home.”

“It also shows that there is a clear reason for first time buyers always to open a Help to Buy ISA, irrespective of when they intend to buy, and especially if they can save the maximum monthly amounts to increase their government bonus.”

Notes to Editors

Help to Buy ISA

  • Help to Buy ISA was launched on 1 December. For every £200 saved into a Help to Buy ISA account, £50 is paid by the Government as a mortgage bonus
  • With a savings rate of 2% AER. Nationwide customers can contribute up to the limit of £200 a month into the Nationwide Help to Buy ISA product and invest into another Nationwide cash ISA product in the same tax year. This is because Nationwide will enable both new and existing customers wanting to open a Help to Buy ISA with the Society to split their ISA savings across more than one cash ISA product, all within the Nationwide ISA wrapper.
  • It is available to first time buyers only. Each first time buyer may open their own account and apply for their own mortgage bonus.
  • First time buyers who save into a Help to Buy ISA will be eligible for a bonus of up to £3,000 (on balances up to £12,000 including interest) each when buying their first home. Savers must have a minimum balance of £1,600 to qualify for the bonus. There will be a maximum savings limit for customers of £1,200 deposit in the first month of subscription, plus £200 a month thereafter into the Help to Buy ISA account.
  • The minimum Help to Buy ISA bonus of £400 can be claimed on February 1 2016 if saving the maximum amount from 1 December
  • Individuals have four years to open the account and the bonus can be claimed up until 2030.
  • Savers can only ever have one Help to Buy: ISA open at any one time.
  • A Nationwide Help to Buy ISA can be opened with new savings, from existing Nationwide ISA savings or from the transfer in of ISA savings from another provider (up to £1,200 in line with scheme rules).
  • Existing Save to Buy savers who are first time buyers can combine their existing Save to Buy savings balance with a new Help to Buy ISA and earn a cashback of up to £1,750 on the total balance when they complete on a Save to Buy mortgage.

Save to Buy

  • Save to Buy is Nationwide’s existing initiative to help those saving for a deposit for their first home, with customers able to access a Nationwide mortgage of between 85.01% and 95% LTV, and receive a cashback of up to £1000 if eligible.
  • From 1st December existing Save to Buy savers can apply for a Save to Buy mortgage, once when they are in at least the third calendar month of holding the account. Nationwide Help to Buy ISA customers must also be in at least the third calendar month of holding their account before being able to apply for a Save to Buy mortgage.
  • The Nationwide Save to Buy cashback and the Help to Buy ISA Government mortgage bonus are accessed differently and the payment is provided in different ways. Nationwide’s Save to Buy cashbacks are available to Nationwide Help to Buy ISA savers on completion of a Nationwide Save to Buy mortgage. To claim the Help to Buy ISA bonus, the Help to Buy ISA account must be closed and the closure statement provided to the conveyancer. The conveyancer will claim the bonus from the Government and use the bonus towards the cost of the house purchase.
  • Most first time buyers with a small deposit could be eligible for both a Save to Buy mortgage cashback and a Help to Buy ISA bonus, but not everyone will always be eligible for both.
  • Save to Buy mortgages will be available for those with a Nationwide Help to Buy ISA from 85.01 – 95 per cent LTV. A 0.40% discount is available on Save to Buy mortgages of 90.01 – 95 per cent LTV. They are also available to those with Save to Buy savings.
  • First time buyers who complete on a Nationwide mortgage are eligible for a £500 cashback

*Flexclusive mortgages are available to Nationwide main current account holders who:

1. Hold a FlexOne account and be aged 18 or over, or hold a FlexAccount with a Visa debit card (not cash card or cash card+) and have:

  • Been paying in £750+ a month for the last 3 months (excluding internal transfers); or
  • Completed an account switch to us (from a non-Nationwide account) using our Current Account Switch Team in the last 4 months; or

2. Hold a FlexDirect or FlexPlus account.


Key features of Nationwide’s fixed and tracker mortgage product range for new applications

1. Flexibility:

  • Overpayments (maximum of 10% of the initial amount borrowed per annum where an ERC applies to the product. Where a product is not subject to an ERC, there is no maximum overpayment allowance).
  • Apply for a Further Advance, the additional borrowing facility.

2. Free Standard Valuation:

  • No standard valuation fees for homebuyers or for those who are remortgaging.

3. Cashback is payable one month after completion of the mortgage, with the exception of the following:

  • For Flex customers applying through the introduced channel the cashback is payable up to three months after completion of the mortgage

4. Maximum LTV:

  • Lending above 90.01% is only available on fixed rate mortgages.
  • 95% LTV mortgages are available to:
    • First-time buyers and home movers.
    • Existing Nationwide mortgage borrowers switching at the end of their current deal or moving home.
    • Save to Buy customers.
  • Maximum 75% LTV on new build flats and 85% LTV on new build houses

5. Base Mortgage Rate

  • Any mortgage products reserved on or before 29 April 2009 will revert to the Base Mortgage Rate (BMR). If the borrower chooses to switch to a new Nationwide mortgage product, the new product will currently revert onto our Standard Mortgage Rate (SMR).
  • Both are variable rates which we may vary in accordance with our mortgage terms and conditions. However, the BMR is guaranteed to be no more than 2% above the Bank of England base rate, whilst the SMR has no upper limit or cap. If the borrower chooses to switch to a new product from a BMR, it is not possible to switch back to the BMR at a later date.
  • All mortgages reserved on or before 3 March 2010 include the option to apply for a payment holiday and borrow-back facility. Any mortgages reserved after this date will no longer include these facilities.
  • If the borrower is currently letting their property they will be unable to switch to a new mortgage deal and their mortgage will automatically revert to the Nationwide variable rate as stated in their mortgage offer.

6. Early repayment charges (ERCs)

If you repay a mortgage early or make an overpayment of more than your overpayment allowance, you may need to pay an Early Repayment Charge. For Nationwide mortgages reserved after 8 October 2014, you would need to pay a percentage of the outstanding loan amount as follows:

Fixed Rate Deal Period
  2 years 3 years 4 years 5 years 10 years
Year 1 2% 3% 4% 5% 7%
Year 2 1% 2% 3% 4% 7%
Year 3   1% 2% 3% 7%
Year 4     1% 2% 7%
Year 5       1% 6%
Year 6         5%
Year 7         4%
Year 8         3%
Year 9         2%
Year 10         1%

ERCs don’t currently apply to our Tracker Rate mortgages.

*Flexclusive mortgages are available to Nationwide main current account holders who:

1. Hold a FlexOne account and be aged 18 or over, or hold a FlexAccount with a Visa debit card (not cash card or cash card+) and have:

  • Been paying in £750+ a month for the last 3 months (excluding internal transfers); Or
  • Completed an account switch to us (from a non-Nationwide account) using our Current Account Switch Team in the last 4 months; or

2. Hold a FlexDirect or FlexPlus account

About Nationwide

Nationwide is the world's largest building society as well as one of the largest savings providers and a top-three provider of mortgages in the UK. It is also a major provider of current accounts, credit cards, ISAs and personal loans. Nationwide has around 15 million customers.

Customers can manage their finances in a branch, via the mobile app, on the telephone, internet and post. The Society has around 18,000 employees. Nationwide's head office is in Swindon with administration centres based in Northampton, Bournemouth and Dunfermline. The Society also has a number of call centres across the UK.

Please note: If you are a customer looking for information on our products and services, please visit the main website.