Shared Ownership is Back!
Scott Austin • June 17, 2020
You can still get on the property ladder without a huge deposit.
Kent Reliance relaunches shared ownership range – exclusive
Kent Reliance for Intermediaries has reintroduced its shared ownership residential product range in response to demand from brokers.
The range is available on purchase or remortgage applications up to a maximum of 75 per cent LTV and up to 100 per cent of the share loan is available from a minimum of £50,000 and up to a maximum of £1m.
The products will also now be reverting to the Bank of England base rate tracker of 4.5 per cent.
The relaunch of the product comes following the lender’s sister brand Precise Mortgage reintroducing its Help to Buy range.
One Savings Bank group sales director Adrian Moloney told Mortgage Strategy that the timing was right to reintroduce the product with physical valuations possible again.
“We have been phasing back in products since physical valuations came back in a very controlled manner to manage capacity,” Moloney says.
“It was always planned to reintroduce this range and it was about getting the product right. With Precise having relaunched its Help to Buy range, the products will work hand-in-hand to support first-time buyers in the market.
“We have heard from brokers that there has been plenty of interest in shared ownership and we wanted to support this. Many mainstream lenders’ more rigid criteria and automated underwriting can struggle to support lending in this space. It’s vital therefore for our broker partners that they know they can turn to us for flexible criteria for their clients. The product range also allows borrowers to staircase towards owning the property outright.”
Kent Reliance’s shared ownership products are available from today, 16 June, and Moloney says that the lender will be using physical valuations going forward.
Mortgage Advice Bureau new homes relationship manager James Chidgey says: “This is a welcome return to the shared ownership sector by Kent Reliance for Intermediaries. They’ve been a big supporter of new build through shared ownership for a number of years, adding their specialist bank approach to the sector with manual underwriting expertise, and can be relied upon for their consistent and flexible decisions.”
Source: Mortgage Strategy Rebekah Commane
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So, here we are half way through 2021 and the property market is still going crazy, I heard a story the other day about a first time buyer that went to view a flat in London and there were 10 other couples waiting outside, now that might not seem like much but it might just put you off selling up and moving. So, if you are going to "stay put" then it is time to think about if you can get a better rate for your current mortgage. With rates at all time lows and not much indication that they are going up anytime soon, this is your opportunity to save money. So if you are on a fixed rate that is going to end in the next 6 months then now is the time to get in touch and see if a better rate is available to you. If you are on the standard variable rate or a tracker and you want to see if a fixed rate is now worth it because the rates are so low then we can help to. We can even help you stick with the same lender and get you a better rate than the standard variable, so if you need quick action we can help there too. Contact Zoom Mortgage telephone 0800310121 email contactus@zoommortgage.co.uk .
This story + many more are available in our 1st edition of the Zoom Mortgage and Property Magazine. Available for you for free here https://zoommortgage.lpages.co/zoom-mortgage-property-magazine THE CORONAVIRUS (COVID-19) pandemic led to the virtual disappearance of mortgages that only required a 5% deposit. But the Chancellor, Rishi Sunak, announced on 3 March a new initiative during his Budget 2021 speech. The government-backed mortgage guarantee scheme is open to first-time buyers and home movers across the UK and is aimed at encouraging banks and building societies to offer 95% loan-to-value (LTV) mortgages again. The announcement is tremendous news for first-time buyers looking to get on the property ladder at a time when, for many, owning a home may seem an impossible dream as they would otherwise not be able to find a large deposit to secure a mortgage deal. GETTING ON THE HOUSING LADDER The announcement aims to stimulate the housing market and get more people onto the housing ladder. The Chancellor said there was good evidence that ‘this will help those that are getting on the housing ladder disproportionately to other home movers.’ He said: ‘We know from the previous time we did it, it helped 100,000 people buy a home and the average value of a home bought under the scheme was £160,000, compared to the average price of a home which at that time was more like £225,000. ‘And 80% were first-time buyers, so it feels like it is a policy that is quite well targeted to help people get on the housing ladder.’ ACROSS THE UK The government introduced the scheme for new mortgage applications which commenced from April and provides a guarantee to lenders across the UK that offer mortgages to people with a deposit of five per cent on homes with a value of up to £600,000. This scheme is for any ‘creditworthy’ household struggling to save for a higher deposit. These will be standard residential mortgages – so no second homes or buy-to- lets. If the borrower gets into financial difficulty and their property is repossessed, the government will cover that element of the lender’s losses. The scheme opened for new mortgage applications from April and will be open to new applications until December 2022. Several of the country’s largest lenders, including Lloyds, NatWest, Santander, Barclays and HSBC, are offering these 95% mortgages, with others to follow shortly after. The mortgages must be on a repayment basis, not interest-only. And borrowers will need to be credit checked and meet the standard rules on affordability. All lenders under the scheme will also offer mortgages fixed for at least five years, providing options for buyers with smaller deposits who want the security and predictability of a mortgage with a fixed rate over a longer term. Eligible mortgages guaranteed under the scheme will need to: • be a residential mortgage (not second homes) and not buy-to-let • be taken out by an individual or individuals rather than an incorporated company • be on a property in the UK with purchase value of £600,000 or less • have a loan-to-value (LTV) of between 91% and 95% of the value of the property • be originated between the dates specified by the scheme • be a repayment mortgage and not interest-only • meet standard requirements in terms of the assessment of the borrower’s ability to pay the mortgage, for example, a loan-to- income and credit score test LIFELINE FOR FIRST-TIME BUYERS Thanks to soaring house prices and tighter rules on mortgage approvals, the first rung of that famous property ladder can be very hard to reach. So the new government backed mortgage guarantee scheme will be a lifeline for those first-time buyers trying to get on the housing ladder. >> GET AN ESTIMATE ON HOW MUCH YOU COULD BORROW << Are you ready to buy a property? You’ve dreamed of owning a home for as long as you can remember, or maybe you’re looking to move to another property. Now the new government-backed mortgage guarantee scheme could make it a reality. To discuss your options and get an estimate on how much you can borrow, contact Zoom Mortgage – telephone 0800310121 – email contactus@ zoommortgage.co.uk
