The Earl Shilton Building Society (ESBS), which has branches in both Earl Shilton and Barwell, is offering first time buyers a five-year discounted rate package up to 90 per cent loan-to-value (LTV) with a variable interest rate of 4.5% for loans up to £125,000. This is a 0.45% discount off the Society’s standard variable rate (4.95%). The overall cost for comparison is 5.0% APR. This applies to repayment mortgages only and carries an arrangement fee of £295. There is an early repayment charge for the first three years and a collar of 2.5%, which means the rate payable will not fall below that figure.
Audrey Green, Business Development Manager at the Society, comments, “Mortgage deals which only require a small deposit are vital in helping first-time buyers on to the property ladder and therefore reviving the housing market. We at the Earl Shilton Building Society have always taken a cautious and prudent approach to lending and feel this is the correct time to be introducing this attractive deal.”
She adds, “We appreciate how difficult it is for people to find extra funds when it comes to paying for valuation fees and legal fees, so any customer taking up this new mortgage offer will see the Society pay any higher lending charges that are incurred and also refund £250 towards the legal fees. Other fees are payable with a detailed illustration available on request.“
ESBS will use income multiples at 3.25 times individual incomes or 2.75 times joint income if buying with a partner, to determine the size of a loan. Initially this mortgage offer will only be available to those living within the Midlands, but this may be reviewed at a later date, depending on the levels of interest.
The 4.5% variable discount rate of ESBS’s new mortgage product compares favourably with the average rate on a 90% LTV mortgage, which currently stands at 6.23% according to new research from www.moneysupermarket.com. It also comes shortly after the Council of Mortgage Lenders (CML) said the number of loans approved for house purchases in the UK rose by 16% in April compared to March.
