Getting on the property ladder is increasingly difficult for first time buyers. In response to this problem, Bank of Ireland UK is developing new mortgage products to offer more options.
This includes First Start, a mortgage launched last year to help first time buyers buy their first home. First Start uses the income of a sponsor, alongside that of the borrower’s, to give more borrowing power, while making sure the mortgage is still affordable. Only a 5% deposit is needed.
Alison Pallett, Director of Sales, Bank of Ireland UK, says, “A healthy first-time buyer market is essential to the wellbeing of the housing market as a whole, and we’re all too aware of the challenges that borrowers face with increasing pressure on affordability and saving for a deposit. We want to help more people to get the mortgage that is right for them.”
We’ve also been doing more listening – based on feedback from brokers we’re increasing the procuration fees on First Start from 0.40% to 0.50%. We understand the product application takes more time as contact is needed with both the borrower and the sponsor, and agree this should be compensated for.”
Michael Webb, Broker at Mortgage Republic explains how First Start has helped develop more conversations with his clients: “Buying a home is an expensive exercise, but First Start has enabled me to discuss the possibility of getting suitable clients higher on the property ladder even quicker. The product has meant some clients have been able to consider three-bedroom instead of two-bedroom properties, and therefore skip a move in the future, which has been a joy to offer.
Recently I spoke to a first-time buyer who had a good salary and was buying on his own. His mother wanted to help, as she knew his salary would increase as his career progressed. First Start enabled his mother to gift the deposit and also use her own income to help her son purchase a bigger home than he would have been able to afford if he’d bought on his own.”