The Cambridge Building Society has relaunched its First Step mortgage which offers first-time buyers the chance to purchase a home with just a 2% deposit.
First Step mortgages are available exclusively to first-time buyers on homes across England and Wales, with borrowing of up to 98% of the property value and a maximum loan size of £500,000.
The Cambridge will lend up to 5.5 times household income, where affordable, and both gifted deposits and loans on new build houses are accepted. Self-employed applicants are also considered in line with the Society's standard criteria.
The First Step range includes a choice of two fixed rate mortgages. Customers can opt for a two-year fixed rate at 5.19% or a five-year fixed rate at 5.49%, giving them certainty over their repayments during the early years of home ownership.
Both options come with a £499 product fee, and include a free basic property valuation, with 10% annual overpayments permitted.
Dan Barker, product and propositions manager at The Cambridge, said: “Saving for a deposit is one of the biggest challenges facing first-time buyers, particularly renters who are already managing high monthly housing costs. By relaunching our First Step mortgage, we’re helping people who can afford mortgage repayments but struggle to save a large deposit to take a realistic step towards owning their own home.
“At the same time, we’ve made sure the product is built around responsible lending, with careful affordability checks and the reassurance of fixed monthly payments.”
