Newcastle Building Society has linked up with Praxis in order to launch into the sub-prime market with an offset mortgage for the near prime market.
The borrowing criteria includes unlimited defaults but no mortgage or rent arrears or CCJs or IVAs in the last 12 months.
The initial interest rate is 1 per cent above Bank of England base rate (currently 6.75 per cent) until 30.09.09, this reverts to 0.50 per cent above Bank of England base rate (currently 6.25 per cent) for the life of the mortgage following two years continuous payment.
The maximum LTV is at 85 per cent and the product has an arrangement fee of 1 per cent. The product has a minimum loan £50,000 and maximum loan of £500,000.
Head of intermediary lending Jon O’Brien says: “Our Offset mortgage is extremely popular and has been targeted at the prime market previously, however, this new product will allow near prime borrowers to benefit from all the advantages an Offset account can provide.”
“We value the involvement of Praxis, who have been instrumental in supporting us through the process and we now look forward to working with them in the future on this, and other projects.”
Praxis’ sales and marketing director Dudley Aldous says: “We are so excited about this product, it is a true exclusive. Newcastle are coming new into the non-standard market, and this just shows they are committed to this market place.”