Skipton Building Society have launched a new mortgage, ‘The Track Record,’ where the buyers do not need a deposit.
The product’s aim is to answer the complaint ‘we cannot save a significant deposit is because they are paying such high rental payments.’ that is made by people renting property. A catch 22 for people in this space.
The Skipton’s answer is that as long as your new mortgage payment is below you previous average rental payment and you can pass the affordability test, then you are able to apply for the 100% scheme.
At launch this is a 5 year fixed rate at 5.59% with no set up fee, our view on why a 5 year fix is that these are cheaper currently than 2 year fixes and protect buyers against any volatility in the bhousing market over the next couple of years.
There are other hurdles that need to get covered off
- Each applicant is a first time buyer
- Each applicant is aged 21 or over
- If they have a deposit, it must be less than 5% of the purchase price
- Each applicant has no missed payments on debts / credit commitments (e.g. mobile phone bill) in the last 6 months
- They are looking to borrow up to £600,000
- They meet the household-to-household criteria (see below)
- They’re not looking to buy a new build flat
- They have proof of having paid rent for at least 12 months in a row, within the last 18 months
- They have 12 months experience paying all household bills within the last 18 months.
You can have up to 4 applicants on the mortgage, but they will need to evidence the rental payments made over the last 12 months.
Joint applicants who have rented seperately will be eligible, but again need to evidence the rent and household expenditure payments. In this case the retnal payments are added together for the loan calculation purpose.
If you are interested in this or any other product please give us a call on 01313392281 or email mark@edinburgh.mortgage
