Darlington Building Society is to launch a ‘Local Heros’ low deposit mortgage product, offering 95% LTV to help key workers onto the property ladder.
This follows Chancellor Rishi Sunak’s recent Budget announcement of a government indemnity on 95% loan-to-value (LTV) mortgages.
However, instead of using the government’s Mortgage Guarantee Scheme, the society will be returning to the 95% LTV market using its own third-party insurance provider.
Darlington Building Society previously had to withdraw its low deposit product due to the COVID-19 crisis, although it did continue to offer 90% LTV mortgages.
The product will be available before the government scheme launches in April.
This is a 3-year fixed rate product, with a £999 product fee and £120 completion fee. It includes up to £300 contribution towards valuation from Darlington Building Society.
It is available on a repayment basis only, up to a maximum loan size of £300,000, and will not be available on new-build properties or flats.
It will be exclusively available to customers where at least one individual on the mortgage is a key worker in the following professions: health and social care; emergency or security services; education and childcare; and other critical services such as supermarket, bank and building society workers.
Darren Ditchburn, chief customer officer at Darlington Building Society, said: “We are really excited and proud to be supporting local first-time buyers who are playing such a vital role as key workers during these unprecedented times.
“We recognise the amazing job they have done, and it is one of the ways we, as a local building society, can say thank you – by helping them to take that crucial first step on the housing ladder.”
He added: “We expect to see a high level of demand for 95% mortgages, and that’s why we have decided to provide priority access to local first-time buyers who are key workers in those vital sectors listed.
“Other products have been introduced that have been exclusively available to NHS staff, but we wanted to widen the scope as much as possible to help more key workers onto the property ladder.”