New key worker mortgage for first time buyers

21-Aug-2007

Scottish Widows Bank has announced that it is to launch a key worker mortgage in an effort to help more first time buyers achieve their goal of buying a home.

Designed as an alternative to the government's Open Market Homebuy scheme, the bank's product enables homeowners to look beyond part ownership in favour of owning the entire property.

The product will also be available to those looking to upsize or remortgage, with 102 per cent loan-to-value offering a solution to those who are unable to afford a deposit.

"Getting onto the property ladder is an uphill struggle for first time buyers and it isn't getting any easier, particularly for Key Workers who often don't earn enough to even contemplate being able to buy close to the area where they work," commented Scottish Widows Bank head of product development and marketing Richard Clark.

"We are pleased to see another example of differentiated lending to help first time buyers," commented Helen Adams, Managing Director of First Time Buyers' advice centre FirstRungNow.com.

"Although Scottish Widows compares this with the government's open Market HomeBuy Scheme, the similarities being the mortgage and the loan, the significant difference is the fact that this is not a shared equity scheme, so the lender will not require a share of any increase in equity in exchange for the 'top up loan'.

"In addition, the key worker applicant will be 'spared' the need to go through the process of waiting to see if there are any budgets available. Scottish Widows also seems to have other products offering similar benefits for those who are not key workers.

"At a time when property prices remain out of reach to first time buyers and lending has out of necessity increased in terms of income multiples, this is another clear example of the future of borrowing for first time buyers who should contact a good broker as a first step," Ms Adams added.

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