The product has been designed to open up the high LTV market to young professionals and graduates in the 21-40 age group who are unable to fund a deposit.
Research commissioned by Genworth showed more than half (57 per cent) of 21- to 40-year-old property-hunters still believe that a deposit is required to secure a mortgage, resulting in a delay in their property purchase and potentially missing out on the benefits of house price appreciation. Furthermore, 60 per cent of those hoping to buy in the next four years said they feared they would find it difficult to raise the money for their deposit.
Tammy Richardson, UK & Ireland managing director for mortgage insurance at Genworth Financial, said: “Raising a deposit need no longer be a barrier to owning a home. Mortgage insurance for 100 per cent LTV lending has a key role to play in providing first-time buyers with earlier access to home ownership while also enabling lenders to grow.”
Genworth’s research findings suggest a significant market opportunity for lenders, with nearly a third (30 per cent) of young professionals and graduates aged 21–40 saying they would definitely consider a 100 per cent LTV product to get them on the property ladder sooner.
Richardson added: “100 per cent LTV mortgages are a growing market proposition and the insurance product we’ve designed uses affordability-driven lending criteria to ensure that mortgage loans are sold responsibly. This means that we’re not just enabling lenders to get first-time buyers on the property ladder – we’re also helping lenders to keep them there.”
