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The new Own New Rate Reducer scheme offers buyers access to reduced mortgage rates. But what’s the catch? We take a look...
Own New Rate Reducer is a scheme designed to make it easier and cheaper to buy a new build home.
Property finance company Own New works with lenders and more than 60 home builders including Barratt Homes, Bellway, Persimmon and Cala, to allow home buyers access to rock-bottom mortgage rates during their mortgage’s initial term.
For example, in summer 2026, Furness Building Society offers a 2 year fixed rate Rate Reducer mortgage at 1.87% if you have a 5% builder incentive (max LTV 80%, scheme fees £999.) By comparison, in June 2026, the best mortgage rate on a 2 year fix was from Halifax at 4.37%. (Scheme fees: £1,099, Max LTV 60%).
KEY INFORMATION
The Own New Rate Reducer scheme is designed to make it easier and cheaper to buy a new build home. Here’s how it works and what you need to weigh up…
House builders often offer incentives to encourage you to buy a new home, from paying your stamp duty bill to upgrading fixtures and fittings. And the Rate Reducer scheme works by using a developer incentive in the form of a contribution to slash the buyer’s mortgage rates over the first few years.
When you choose your property, the developer will agree to contribute 3% or 5% of the purchase price. This contribution goes to your mortgage lender, via Own New, and the lender will offset the contribution against the mortgage interest to reduce your monthly payments for the first 2 or 5 years, depending on the length of your initial term.
Get fee-free mortgage advice from the award-winning expert advisers at Mortgage Advice Bureau.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Please note some branches of Mortgage Advice Bureau may charge a fee for mortgage advice if you go direct. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed. So make sure you use this site, this form or phone number for fee-free advice.
Own New Rate Reducer scheme mortgage rates are typically lower than you’ll find on the open market.
For example, as we explain above, Furness Building Society offers a 2 year fixed deal at an eye-catching 1.87% if you have a 5% builder incentive. But this rate is only available if you have a 20%+ deposit.
If you have a smaller deposit, rates are less attractive, but they’re still typically better than you’d get on the open market.
For example, if you’ve got a 10% deposit and you’re taking out a £200,000 mortgage, Furness offers an Own New Rate Reducer 2 year fixed rate mortgage at 2.43% (max LTV 90%, scheme fees £999).
By comparison, the average mortgage rate on a 2 year fix at 90% LTV in June 2026 is 5.32%, according to Rightmove. .
But bear in mind that if you’re using the scheme, the incentive is going to the lender to reduce the your mortgage payments. If you negotiated the same incentive as money off your purchase, you may pay a higher amount on your mortgage payments but your mortgage would be smaller.
See our mortgage cost calculator to work out the cost of your mortgage or to compare mortgage deals.
Get fee-free mortgage advice from the award-winning expert advisers at Mortgage Advice Bureau.
Your mortgage rate will be fixed for 2 or 5 years, depending on which mortgage product you take out when using the Own New scheme.
Once your fixed deal ends, you’ll either need to remortgage onto a new deal or you’ll roll onto the lender’s standard variable rate. You may see your mortgage rate jump significantly once you move off this scheme.
The Own New Rate Reducer scheme is open to anyone buying a new build property, whether you’re a:
Leek Building Society, Darlington Building Society and Furness Building Society are among lenders that now offer mortgages through the scheme.
To buy a home through Own New Rate Reducer you’ll need to speak to an approved mortgage broker. Speak to the award-winning expert advisers at Mortgage Advice Bureau to find out more.
Get fee-free mortgage advice from the award-winning expert advisers at Mortgage Advice Bureau.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Please note some branches of Mortgage Advice Bureau may charge a fee for mortgage advice if you go direct. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed. So make sure you use this site, this form or phone number for fee-free advice.
If you’re considering the Own New scheme it’s important to weigh up the pros and cons.
Barratt Developments worked alongside Own New to design Rate Reducer and was the first housebuilder to launch the scheme. However, many developers are signed up to take part include Persimmon, Taylor Wimpey, Bellway and Berkeley Homes.
If you want to buy a property through the Own New scheme here’s the process:
The process of buying a new build is slightly different to buying an older property. Find out more in our guide New build conveyancing explained and research what buying a new build involves including buying off-plan and the common pitfalls and problems in Top Tips to Buying A New Build.
Sarah Tucker, our Mortgage Expert comments that,“With the Own New Rate Reducer Scheme, the lower initial mortgage rates can make homeownership feel far more accessible and may allow some borrowers to buy sooner than they otherwise could.
However, it’s important borrowers fully understand how the scheme works and consider the longer-term picture, not just the lower payments during the first few years. Once the initial deal ends, repayments could increase significantly depending on mortgage rates at the time.”
Get fee-free mortgage advice from the award-winning expert advisers at Mortgage Advice Bureau.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Please note some branches of Mortgage Advice Bureau may charge a fee for mortgage advice if you go direct. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed. So make sure you use this site, this form or phone number for fee-free advice.
Own New Rate Reducer isn’t the only scheme that can help you buy a house. Alternatives you may want to investigate include:
You can check the best mortgage rates available at the moment with our Best Mortgage Rates guide which is updated daily, alongside our dedicated guide to the Best First Time Buyer Mortgage Rates.
However, the best mortgage depends on your personal circumstances. The award-winning expert advisers at Mortgage Advice Bureau will find the right mortgage for you.
The Own New Rate Reducer scheme launched in February 2024.
Own New also offers the Deposit Drop scheme, which you buy a new build home from a participating developer with a 5% deposit. Deposit Unlock works in a similar way as it also allows you to buy a new build house with a 5% deposit. Read more in our guide Deposit Unlock scheme explained. But there are some differences, such as you’ll get access to different mortgage lenders.
HomeOwners Alliance Ltd is registered in England, company number 07861605. Information provided on HomeOwners Alliance is not intended as a recommendation or financial advice.
HomeOwners Alliance Ltd is an Introducer Appointed Representative of Mortgage Advice Bureau (Derby) Limited which is authorised and regulated by the Financial Conduct Authority.
HomeOwners Alliance Ltd is an Introducer Appointed Representative (IAR) of LifeSearch Limited, an Appointed Representative of LifeSearch Partners Ltd, authorised and regulated by the Financial Conduct Authority. (FRN: 656479).
Independent Financial Adviser service is provided by Unbiased, who match you to a fully regulated, independent financial adviser, with no charge to you for the referral.
Bridging Loan and specialist lending service provided by Chartwell Funding Limited, registered office 5 Badminton Court, Station Road, Yate, Bristol, BS37 5HZ, authorised and regulated by the Financial Conduct Authority (FRN: 458223). Your property may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it.
