BM Solutions has introduced its eagerly anticipated first-time buyer product, modelled on Northern Rock’s successful Together offering which allows friends to club together and buy a property.
BM expects a significant proportion of customers to be past homeowners. with borrowers likely to be in their early 40s, or graduates and professionals with high potential for income growth.
Mortgage Plus connects a secured mortgage and an unsecured personal loan. It is only available through intermediaries to borrowers with a good credit history and BM says half of the applicants are likely to be declined.
It is available as either a fixed rate or a tracker. The combined maximum loan to value is 125 per cent, 95 per cent of which is a secured loan on the property and the rest an unsecured personal loan but there will be only one monthly payment.
BM does not expect the product to have as significant an impact on its level of completions as Together, which was launched in 1999 and accounts for one-third of Northern Rock mortgages.
Bank of Scotland Mortgage managing director Charles Haresnape has previously said that HBOS is considering launching an additional FTB product, combining rental and homeownership.
BM managing director Nigel Stockton says: “The product will be available to some FTBs but will not be as important to us as Together has been to Northern Rock.”
Hamptons International Mortgages technical director Jonathan Cornell says: “It is great to see HBOS moving into this market. I am sure this will increase competition in this sector, which will benefit borrowers. I think it has been a gap in HBOS’s product range until now.”