Newcastle for Intermediaries has launched First Step, a mortgage for first-time buyers (FTBs) with smaller deposits.
The product offers lending up to 98% loan-to-value (LTV), with a minimum cash deposit of £5,000 – customers can borrow up to £350,000.
The 5-year fixed rate is set at 5.25% (6.2% APRC) and includes a free standard valuation on properties up to £550,000, as well as 10% overpayments per year.
The product, initially launched with London and Country Mortgages, Connells Group and Mortgage Advice Bureau, will be released to the wider market at a later date.
The deal is aimed at buyers struggling to save large deposits in the current housing market.
Francesco Di Pietro (pictured), head of intermediary mortgages at Newcastle Building Society, said: “We know how hard it is for many first-time buyers to build a large deposit in today’s housing market.
“First Step has been designed to give people who have worked hard to save a cash deposit a realistic route into home ownership, while ensuring robust affordability and lending criteria.
“We’re pleased to bring this practical, intermediary-focused solution to market and to support brokers in finding the right outcomes for their clients.”
Sidney Wager, managing director at L&C Mortgages, said: “L&C Mortgages is delighted to partner with Newcastle Building Society in its launch of the First Step product, ahead of its full market release.
“We know that first-time buyers continue to face significant difficulty in building a big deposit to stand a chance of buying.
“This will allow L&C advisers to find a solution for more first-time buyers, who can afford to buy but may only have a smaller cash deposit.”
Wager added: “It’s a practical step towards broadening routes to homeownership, harnessing the value of advice to ensure positive outcomes for customers.”
