It aims to support borrowers with past credit blips
Specialist lender Kensington Mortgages has introduced the Step Down five-year fixed rate mortgage, expanding options for clients with previous credit issues.
The new range offers a standard fixed rate for the first two years, followed by a reduced fixed rate for the remaining three years.
The Step Down mortgages are part of Kensington’s Resi 6 and Resi 12 ranges. Resi 6 is available to clients moving home or remortgaging after a credit blip more than six months ago. Resi 12 is for those moving or remortgaging after a credit blip more than 12 months ago, and it is also available to first-time buyers. The criteria for these mortgages include considerations for county court judgements, defaults, payday loans, debt management plans, and credit arrears.
The Step Down range offers overall savings compared to equivalent five-year fixed rates, with the reduced rate after the initial two years providing additional security.
For instance, a client borrowing £200,000 at 75% LTV over a 30-year term to buy a £300,000 home could save £3,587 over five years with the Resi 6 Step Down, while a client purchasing a £500,000 property with an 80% LTV £400,000 loan over a 40-year term could save £6,943 over five years with the Resi 12 Step Down.
“We are excited to be introducing our new Step Down range, which we hope will provide a wider set of options for borrowers who have previously experienced a credit blip,” said Vicki Harris (pictured), chief commercial officer at Kensington Mortgages.
“Clients have an opportunity to make significant savings in comparison to a standard five-year fixed rate while also benefitting from the additional certainty afforded by access to a lower rate after the first two years. This latest range highlights our commitment to developing innovative solutions for our customers while maintaining our dedication to leading broker service and exceptional service times.”
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