Specialist Bank Aldermore has launched two lending tiers across its Help to Buy: equity loan mortgage range, both with free standard valuations.
Available from today, there’s a Level 2 with rates from 4.78% up to 75% LTV and Level 3 with rates from 5.28% up to 75% LTV.
The two new tiers mean the bank will now consider customers if they have: CCJs or defaults registered over two months, bankruptcy or IVA discharged for two years, mortgage or secured loan arrears over 3 months ago or forced or voluntary possessions older than three years.
Damian Thompson, director of mortgages, Aldermore, said: “The average first time buyer is 31 years old2 which means they were starting their careers the same year the global financial crisis began.
“This group has had to navigate a hugely challenging economic climate so it is reasonable to expect some may have had credit blips, gaps in employment, and even resorted to short-term credit in the past.
“At Aldermore, we understand getting on the property ladder is no easy feat and securing a mortgage can be a cause for concern.
“We believe that those that have since recovered from credit difficulties in their past should have the opportunity for home ownership.
“Our human approach to lending enables us to consider each case on its individual merits so we can support those people with a complex financial history or a less than perfect credit score find a home.”
According to Aldermore’s First-Time Buyer Index 35% of prospective first-time buyers are worried about how their credit rating could impact their home buying chances, with 38% actively taking measures to improve their credit score.
The Index shows many prospective buyers have had minor credit blips in their past; 13% have had credit card debt, 12% have missed bill payments and 7% have taken out payday loans.
The research also shows a proportion have had larger credit issues with 6% having had accounts handled by collection agencies, 4% having CCJs on their record and 3% having declared bankruptcy in the past.