Nationwide launching first-time buyer 'helping hand' mortgage with 5.5 times salary income multiple
Nationwide for Intermediaries has announced plans to launch a 'helping hand' mortgage from 26th April providing up to 5.5 times salary multiples to first-time buyers when they take a longer-term fix.
The lender has allocated £1bn to fund this programme, which it says it has developed in response to metrics such as the average first-time buyer property value increasing 41% against an average income rise of 18% over the last decade.
The 'helping hand' mortgages will be available to employed borrowers and not the self-employed and they must be taken on full capital repayment. They cannot be used in conjunction with any scheme or non-standard ownership type (for example Shared Ownership, or Help to Buy. The minimum income requirement is £31,000 for sole applicants and £50,000 for joint applicants. All income sources (except self-employed income) can be included.
Aaron Strutt, product director at Trinity Financial, says: "Some of Nationwide's biggest competitors have been offering 5.5 times salary mortgages for years but borrowers typically need to earn over £75,000 or be a professional like a doctor or lawyer to qualify.
"While it is good news that Nationwide will be offering higher income multiples, borrowers will have to take a five-year or ten-year deal rather than the more traditional two or three-year fix. As there are other banks and building societies offering over five times salary multiples it is worth making sure you choose the right provider so you don't find yourself trapped in an unsuitable long term product."
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