Who are The West Brom?
West Midlands based building society The West Brom has announced that they are vetoing their ban on shared ownership mortgages.
The 173 year old building society, which was once known as a good new build shared ownership specialist, dropped out of the affordable housing market during the pandemic. An uncertainty of how the housing market was going to go combined with an unwillingness to invest in so called ‘affordable housing schemes’ at an uncertain time meant that The West Brom has been in a kind of limbo for the last two years. Not offering particularly low interest rates on standard residential mortgages and not offering any specialist mortgages like shared ownership, they more or less fell off the map.
What has changed?
This week however, they made the most sensational return of the year as the announced that they were back. Bigger and better! That’s right, another lender has re-invested faith in younger buyers who are looking to get their foot on the housing ladder with shared ownership mortgages.
The society is releasing several competitive shared ownership mortgage products and rates tailored towards first-time buyers and existing shared owners with smaller deposits. These products are available up to 95% of the buyers share, something that only a handful of lenders offer.
What are the facts and figures?
The West Brom has announced that the products include a two-year fixed-rate loan for house purchases of 3.59% at 95% borrower share, with no completion fee. And a five-year fixed-rate offer for house purchases at 3.69% at 95% borrower share, with no completion fee and £500 cashback. These products will revert to the societies standard variable rate at the end of the fixed-rate, currently 4.09%.
What has the lender said?
Head of intermediaries at The West Brom Richard Scott has commented:
“We’re pleased to be re-entering the shared ownership market with a competitive range of products. Supporting first-time buyers and those looking for affordable routes into homeownership is a core part of our purpose, and our new deals will help many more achieve their homeownership goals”.
What do the experts say?
Content manager at Oportfolio Mortgages Louis Mason says:
“Having worked in shared ownership specific mortgages for a few years in the past, I know how difficult it can be to find a lender that ticks all the boxes. People generally choose a shared ownership mortgage because they are unable to meet the criteria for a standard mortgage i.e. unable to save the required deposit or perhaps their income is a bit too low.
So, when shared ownership lenders enter the market and demand a 20-30% deposit, that just isn’t right in my opinion. More shared ownership lenders should be identifying their customers and realising that for some people, this is the only way they will be able to break the generation rent cycle.
By offering 95% mortgages on a share of a property, The West Brom are really tuning in to who their clients are. So many people who have been struggling to pay rent and save a deposit will now be able to get the property they could only dream of before.”
If you or someone you know is interested in shared ownership mortgages, please feel free to give our friendly team a call on 02088771169. We are more than happy to help!