The Ipswich Building Society has introduced two dedicated gifted deposit products, extending its criteria around the range of family members allowed to gift under its rules and enabling access to up to 95% loan To value (LTV) without requiring deposits to be supplemented or matched by the applicants own funds.
Designed to provide support for would-be first-time buyers with a continuous rental history of 12 months or more, the mutual’s revised gifted deposit rules take a new approach to allowing support from family members, including the applicants’ parents, step-parents, siblings, step-siblings, grandparents, step-grandparents, children, step-children, and adopted children.
The society’s standard residential products are already available for gifted deposits up to 90% LTV, restricted to funds from parents, grandparents and siblings. Products will continue to be available on this basis for applicants meeting this criteria.
Gifted deposits can be used to make up the entire deposit contribution on its standard residential and new 95% LTV range without the requirement of the applicants own funds.
The following gifted deposits products are now available for purchase and remortgage with a maximum 95% LTV and up to £500,000 loan size:
- A two-year fixed rate of 3.45% fixed until 31 July 2020 (5.3% APRC). A completion fee of £800, application fee of £199, CHAPs fee of £35 and a tiered valuation fee – based on property value – apply.
- A two-year discount rate at the Society’s Standard Variable Rate, currently 5.49%, with a discount of 2.60% giving a pay rate of 2.85% for two years from completion (5.2% APRC). Whilst the product offers a zero completion fee, an application fee of £199, CHAPs fee of £35 and a tiered valuation fee – based on property value – apply.
The products feature a 50% fee free overpayment facility, whereby borrowers can overpay penalty free by up to 50% of the original loan amount. For overpayments in excess of this amount, or early redemption, an Early Repayment Charge (ERC) applies at 1% until two years from completion for the discount rate product, and at 3% for the fixed rate product until 31 July 2020. For overpayments this is calculated on the total overpayment amount, and for early redemption it’s calculated on the original loan amount.
Richard Norrington, CEO of the Ipswich Building Society, said: “We recognise how difficult it is for some borrowers to get on the housing ladder and our approach, based on making sensible lending decisions using expert individual underwriting, will mean that potentially more younger people and first-time buyers will be able to access the mortgage market.
“Tackling mortgage misfits, those who are under-served by the automated high street lenders, remains one of our priorities.”