The Co-operative Bank has launched a two-year fixed rate mortgage at 3.99 per cent with no arrangement fee and borrowers need just a 10 per cent deposit.
By using money from the government’s Funding for Lending Scheme (FLS), the Co-operative Bank aims to boost first-time buyer lending. Generally, lenders have so far used the FLS to support those with bigger deposits or equity in their home.
As part of its wider ambition to help people onto the property ladder, the bank has also partnered with Camden Council to launch a shared ownership scheme to help first-time buyers to combat high house prices in the region.
In addition, the Co-operative Bank continues to offer borrowers a route into home ownership via its guarantor mortgages, which enable borrowing on the basis that a parent or guardian guarantees repayments, or through Share to Buy, which is a solution for those who wish to get a foot on the property ladder by buying with friends.
James Hillon, head of mortgages at The Co-operative Bank, said: “We welcome the FLS as a route to boosting the housing market and the wider economy, but believe this goal will only be achieved by increasing the availability of mortgages to first-time buyers rather than just focusing on remortgage customers.”
“By offering a market leading rate, fee free to those with a 10 per cent deposit, we hope to remove some of the barriers to getting on the property ladder and offer first-time buyers a helping hand.”
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