Na­tion­wide to restart 90pc loans for first-time buy­ers

The Daily Telegraph - Business - - Business - By Adam Wil­liams

NA­TION­WIDE has be­come the first high street brand to restart mort­gage lend­ing to first-time buy­ers with a 10pc de­posit, fol­low­ing the Gov­ern­ment’s move to boost the hous­ing mar­ket.

Bri­tain’s big­gest build­ing so­ci­ety re­stricted its mort­gages in June, cit­ing fears that fall­ing house prices could leave high-mort­gage bor­row­ers in neg­a­tive eq­uity. Since then, only cus­tomers with 15pc de­posits have been able to ap­ply for loans, with many po­ten­tial first-time buy­ers locked out of the mar­ket. How­ever, Na­tion­wide said the stamp duty tax break in­tro­duced last week by Rishi Su­nak, the Chan­cel­lor, had helped re­store con­fi­dence in the coun­try’s strug­gling prop­erty sec­tor.

Although most first-time buy­ers al­ready paid re­duced or no stamp duty, Na­tion­wide said the move would im­prove con­fi­dence in the wider mar­ket.

This will al­low it to re­sume lend­ing to first-time buy­ers with a 10pc de­posit from July 20.

Last week, Tele­graph Money called on banks to sup­port first-time buy­ers af­ter the stamp duty cut left them fac­ing greater com­pe­ti­tion for homes but with lit­tle ac­cess to lend­ing. Na­tion­wide

was one of many banks and build­ing so­ci­eties to with­draw 5pc and 10pc de­posit mort­gages in re­cent months.

HSBC has been the only ma­jor brand to of­fer 90pc mort­gages through­out the pan­demic, although only lim­ited num­bers have been avail­able.

Na­tion­wide said it would have no limit on its lend­ing but that it would con­tinue to mon­i­tor mar­ket changes.

Fol­low­ing Na­tion­wide’s an­nounce­ment, Coven­try Build­ing So­ci­ety said it would of­fer 90pc mort­gages on a trial ba­sis to­day and to­mor­row.

Plat­form, part of the Co-op­er­a­tive Bank, will also of­fer 90pc loans from to­mor­row.

Chris Sykes of Pri­vate Fi­nance, a mort­gage bro­ker, said that some banks had been re­luc­tant to of­fer small-de­posit loans be­cause of fears they would be over­whelmed with ap­pli­ca­tions.

He added: “With Na­tion­wide be­ing one of the largest lenders for first-time buy­ers, this is likely to en­cour­age oth­ers back into the mar­ket.”

How­ever, the busi­ness said it would not lend to those buy­ing flats or new­build houses.

These are typ­i­cally per­ceived as most vul­ner­a­ble to sud­den price falls if eco­nomic con­di­tions worsen.

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