Both are offering mortgage rates of around 4 per cent - about half the going variable rate.
Under the Cheltenham & Gloucester offer first-time buyers can get a 3.99 per cent loan fixed until the end of February next year. Borrowers will then go on to the society's variable rate - currently 7.99 per cent - for the next two years.
Nationwide is offering a 4.25 per cent two-year fixed loan on 1,500 of its repossessed properties. These are located throughout England and Wales and most are selling for between pounds 15,000 and pounds 50,000. They are all properties which the society has found difficult to sell but they are, according to the society, going at full market value.
Both schemes require a 10 per cent deposit. Nationwide also insists that borrowers take out a mortgage payment cover policy, but the society will pay the costs of the valuation.
Although the C&G rate is fixed only for one year, it is still effectively a three-year mortgage. The society will claim back all the subsidy it has made to the borrower in the first year if the mortgage is redeemed before the end of three years.
'We cannot afford to lend for 3.99 per cent unless we retain the borrower,' said a spokeswoman.
Despite the requirements for a 10 per cent deposit, C&G believes that many first-time buyers will be able to afford the deal.
The maximum loan is pounds 70,000 and the society has found that, on average, first time buyers have 15 per cent deposits. The offer is expected to last for about a month, when it will be replaced by another first-time buyer product.Reuse content