Newcastle Building Society has boosted its Deposit Unlock scheme for customers with small deposits by cutting rates and raising the maximum purchase price.

The mutual’s scheme was launched in June and aims to give more borrowing options on new build homes for customers with a 5% deposit.

The lender says a two-year fixed-rate deal is available at 2.79%, which is a 0.71% cut on the previous rate. And a cut of 0.56% has been applied to its five-year fixed-rate offer, now available at 3.19%.

Both loans come with no product fees, with the lender introducing free standard valuations for properties up to £500,000 and £500 cashback.

Early repayment charges of 2% until 28 February 2023 and 1% until 29 February 2024 is payable on the two-year product.

The five-year product attracts an early repayment charge of 5% until 28 February 2023, 4% until 29 February 2024, 3% until 28 February 2025, 2% until 28 February 2026 and 1% until 28 February 2027.

The firm has also lifted the maximum purchase price for the programme from £330,000 to £600,000, “reflecting the national scope of the scheme”.

The programme, backed by the Home Builders Federation and supported by selected national home builders, was rolled out across the country in September.

The lender adds that “a further expansion in the number of developers involved in the scheme is expected later this year”.

Newcastle Intermediaries head of intermediary mortgages Franco Di Pietro says: “Deposit Unlock is a true innovation and gives low deposit buyers a great option on new builds.

“As the first lender to bring the scheme to market and roll out nationally, it means we’re also the first to respond to broker feedback, refining the proposition to make it an even more attractive option for customers and broaden access to the product range across the country.”