Deposit Unlock scheme signs up 50 housebuilders – Mortgage Strategy
The housebuilding industry’s 95% loan-to-value mortgage scheme, Deposit Unlock, has signed up 50 builders, says the Home Builders Federation.
The 5% deposit plan was developed by the trade with homebuilders and reinsurance broker, Gallagher Re.
It includes such builders as Persimmon, Taylor Wimpey and Crest Nicholson.
The measure, rolled out last August in England, aims to get more buyers onto, or moving up, the housing ladder.
It picks up from the government’s Help to Buy scheme, which winds up at the end of this month after ten years.
The Deposit Unlock works by offering participating mortgage lenders protection on mortgage products so they can lend to consumers at 95%.
The federation says this means first-time buyers and existing homeowners can use the programme to buy a new-build home worth up to £833,000 with a 5% deposit with “a competitively priced mortgage product”.
Its lenders are Nationwide Building Society, Accord Mortgages and Newcastle Building Society.
The scheme signing up 50 builders comes in the middle of New Homes Week — 27 February to 3 March — which released a poll that found that 18% of people said the top issue preventing them from buying a house was uncertainty over whether they would be able to secure a mortgage.
Last month, the trade body launched a dedicated website for the scheme.
Home Builders Federation executive director David O’Leary says: “The scheme began with one lender and 17 home builders. It has now extended across a range of mortgage lenders and HBF members nationally.
“Importantly, against a challenging financial backdrop, it’s providing much-needed support to enable more families to achieve homeownership.”
Gallagher Re managing partner of mortgage indemnity reinsurance Steven Rance adds: “Even in today’s tough financial environment, competitively-priced low-deposit mortgage products for new build homes, with all their energy performance benefits, are now more available throughout the UK thanks to the scheme.”
The quoted survey was carried out by research firm Yonder Data Solutions between 3 February and 5 February among 2,088 UK adults.