Suffolk Building Society has cut rates across its interest only residential range by up to 16 basis points.
The mutual has also unveiled a new 90% loan-to-value (LTV) discounted mortgage, marking a shift towards supporting first-time buyers and others with limited deposits. Available from 11 June 2025, the two-year discount product is priced at 4.95%, with a maximum loan size of £650,000, and is open to both purchasers and remortgage customers.
Charlotte Grimshaw, head of intermediaries at Suffolk Building Society, said: “There’s a strong focus on supporting first time buyers at the moment – and so there should be; they underpin our housing market. However, interest only borrowers, who often fall into the ‘later life’ group, have long been underserved – facing age restrictions and limited options.
“With our changes to repayment vehicles, we decided to close the rate differential between our capital and interest, and our interest only products – giving people more choice. This helps borrowers who are looking to borrow into retirement, people currently on interest only terms, or those looking to migrate over to interest only.”
The rate reductions apply to products at up to 80% LTV, and are as follows: the two-year discounted interest only mortgage now stands at 4.85%, down 15 basis points from 5.00%; the two-year fixed rate has been cut by 16 basis points to 4.99%, and the five-year fixed rate now stands at 5.09%, also reduced by 16 basis points.
This repricing follows a criteria change introduced on 9 June, in which the Society increased its maximum LTV on downsizing interest only cases from 50% to 70%, enhancing options for older homeowners seeking to unlock equity while maintaining flexibility in their repayment strategy.
Suffolk’s latest update comes amid continued speculation about the Bank of England’s base rate trajectory, with many lenders positioning themselves to capture early demand ahead of any potential easing. The Society’s move to introduce a high-LTV product also reflects a growing appetite among lenders to re-engage with a first-time buyer segment that has borne the brunt of rate volatility over the past 18 months.
Grimshaw added: “These rate reductions come on the back of the significant criteria change we made on Monday, increasing the maximum LTV from 50% to 70% when downsizing.”
