Now that Aldermore’s 100% mortgages are now available, the lender has expanded its distribution following a successful pilot.
The family guarantee mortgage is being offered through Mortgage Intelligence, Mortgage Next, Legal & General Mortgage Club, Pink Home Loans, Sesame, Countrywide and Personal Touch Financial Services.
The 100% mortgages deal is a three-year fixed rate of 6.48% and asks a parent or grandparent to provide a guarantee secured against their property for the loan amount above 75% LTV.
The product was initially piloted through Connells Group, Arun Estates and 3mc in September.
Charles Haresnape, managing director of residential mortgages at Aldermore, says: “The pilot proved that our systems and processes work efficiently and we are confident that we can roll out the product more widely.
“We have had good take-up so far and the decline rate has been no higher than for our other mortgages.”
He adds that the lender will look to develop similar products in the coming months.
Dev Malle, sales and marketing director at PTFS, says the network sees this as an innovative product which responds to the problems of the current market without being too risky.
He says: “This 100% mortgages deal recognises the fact that more and more first-time buyers are relying on their parents for deposits, but also that there are limits to parents’ capacity to help.
“It allows parents to assist their children without having to guarantee the whole mortgage and it remains within the scope of prudent lending as it is only available to prime borrowers.”
David Copland, managing director of Pink, says: “I believe there is high demand for this type of product, but we need to manage brokers’ and consumers’ expectations as it is only suitable for a certain type of client those with relatively high earnings and a good track record.”