Council chiefs in Sandwell in the West Midlands have launched a new ‘affordable mortgages’ scheme in a bid to help first-time buyers get a foot on the housing ladder.
The scheme is also aimed at getting the housing market going and increasing house building in the borough, the council said.
First-time buyers can apply for up to 95 per cent mortgages on new build homes in Sandwell.
The council’s finance boss Councillor Steve Eling said the scheme, which launched this week (1 October) would offer “sensible, affordable” mortgages through a self-funding scheme.
Councillor Eling has allocated £2 million to set up the scheme, with the council holding properties as security so taxpayers’ money is not at risk.
He said: “Young first-time buyers in Sandwell are struggling to get a foot on the housing ladder and we want to help them. We think it’s very important for people to have the chance to buy their own home – and it’s good for the economy and housing market too.”
Councillor Eling, the council’s deputy leader and cabinet member for strategic resources, said the council would require home buyers to put down a deposit of at least five per cent of the house value.
Banks, building societies and other providers have put in place many more restrictions on mortgages since the banking crisis, and deposits can be up to 40 per cent.
Councillor Eling added: “The mortgages we plan to offer will be sensible and affordable, not the type of reckless mortgages that some of banks and building societies used to offer. This scheme will also help people who are looking to buy new homes that we know are being built in Sandwell and encourage new house building too by giving developers increased confidence.”
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