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First Homes Scheme 2 Year Fixed Rate House Purchase Only – DIX226

Key Details

Term 2 years
Initial Rate1 3.99%
Overall Cost For Comparison2 5.3% APRC
MAX LTV3 95% of the discounted price
Early Repayment Charge 2%
Product Fees £199 application fee

Representative Example

A mortgage of £119,700.00 payable over 35 years initially on a fixed rate of 3.99% for 2 years and then on our current standard variable rate of 5.35% for the remaining 33 years would require 23 monthly payments of £529.86 and 396 monthly payments of £627.37 plus one initial interest payment of £405.64.

The total amount payable would be £261,729.94 made up of the loan amount, plus interest and fee(s) totalling £142,029.94. This includes Application Fee (£199), Chaps Fee (£25), Legal Fees (£350) and Redemption Administration Fee (£125).

The overall cost for comparison is 5.3% APRC representative.

Your home may be repossessed if you do not keep up repayments on your mortgage

Mortgage Product Features

  • Exclusively available to first-time buyers for house purchase only on qualifying properties under the First Homes scheme (see further details below)
  • Available via selected intermediaries only
  • Minimum loan size £75,000, maximum loan size £250,000
  • No completion fee
  • Free basic valuation
  • An early repayment charge of 2% of the agreed advance including any fees added will apply if the mortgage is redeemed at any time during the first 2 years

First Home Scheme Criteria

The First Homes scheme is a UK Government initiative that enables first-time buyers to purchase properties on designated developments in England with a minimum discount of 30% below their full market value. More details about the scheme can be found here https://www.ownyourhome.gov.uk/scheme/first-homes/.

A larger discount and/or further restrictions may be applied by the local authority or neighbourhood planning groups, please check the specific developments for details.

Main conditions of the scheme include:

  • After the discount is applied the initial sale price of a property under the First Homes scheme must not exceed £250,000 (or £420,000 in Greater London)
  • Properties within the First Homes scheme are subject to restrictions which ensure that the homes retain their discount when they are sold onto other eligible purchasers and properties under the scheme are not intended to be used for commercial gain and cannot be used as holiday homes or buy to lets
  • Purchasers of First Homes must be first-time buyers and must have a household income not exceeding £80,000 (or £90,000 in Greater London).
  • Local authorities or neighbourhood planning groups can apply additional criteria such as lower income caps within the first 3 months of marketing the property, please check your property’s restrictions before proceeding
  • A First Home should be the buyers only home and a purchaser will need to use a mortgage or home purchase plan for at least 50% of the purchase price of the home

The information provided above is not exhaustive as local restrictions may apply, for full details please contact the property developer.

Important Information

Unless otherwise stated, our mortgage products are available for house purchase or remortgage. All our mortgage products are subject to availability and can be withdrawn at any time.

All mortgage applications are manually underwritten by our experienced underwriters and are subject to a full assessment against our lending criteria.

It is important that you take time to read and understand the mortgage product features detailed above and the information about our Residential or Buy to Let mortgages detailed in the General Information Guides.

How to Apply

Please contact our Intermediary Support team for further details. You can check affordability on our website and submit a DIP request or request an ESIS from our online portal. You can apply either online or through the post.

Definitions

1. The Initial Rate is the rate available during the initial term of the mortgage. Once the initial rate term has expired, the mortgage will revert to our Standard Variable Rate (SVR).

Our SVR is set by us and is currently 5.35%, as a variable rate it may go up or down.

2. The Overall Cost for Comparison is given as the Annual Percentage Rate of Charge (APRC) and includes all charges incurred relating to the mortgage. The APRC is intended to help you as a borrower compare the interest rates on different products.

3. Like all other mortgage lenders, we will allow you to borrow against a proportion of the overall property value. This is known as Loan to Value (LTV) and is expressed as a percentage. For example, if you want to purchase a property at £100,000 and you would like to borrow £85,000, then you will need a mortgage available at 85% Loan to Value (LTV). The available LTV can vary depending upon the type of mortgage.

Shared Ownership mortgages will offer two percentages under LTV – the proportion of the property value and the proportion of the share being purchased.

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