These days there are so many people who are struggling to get onto the property ladder. House prices keep on rising through the roof and the majority of the population struggles to save up enough for a deposit. Well, it looks like there could now be a solution for those who work within the NHS or the police, teaching, and fire fighting industries. The specialist mortgage lender Kensington are now offering people within these sectors new “Hero mortgages”.
These new types of mortgages are aimed solely at those who work in the public sector. Kensington appreciates that jobs in this sector don’t always pay that well, so they want to make it easier for public-sector workers to purchase their first home.
Most lenders would be wary about lending to people in these industries because of their low wages. However, Kensington are happy to do so for a couple of reasons. Firstly, this sector usually offers some very good job security, so there is actually little risk of workers losing their job unexpectedly. Not only that, though, but public-sector jobs usually offer good earning potential as well, so there’s a chance that most people in these sectors will benefit from pay rises over the years. So, even if an individual doesn’t start on such a high wage, they should still be able to pay off their mortgage over the years, making them less of a risk for Kensington.
How Does It Work?
Usually, a lender will offer a homebuyer the chance to borrow up to 4.5% of their annual income. This usually includes 50% debt-to-income. With this new Hero mortgage from Kensington, a homebuyer can lend up to 5 times their income with 55% debt-to-income ratio.
Kensington have spent a lot of time researching the income that the average worker in the public sector gets. As well as their annual income, they also spent time studying their usual financial behaviour and potential career trajectories.
This has helped them to fully understand the earnings of individuals in the public sector and the job security in the industry. From all of this information and data, they have been able to come up with the best-possible regulations and conditions for their Hero mortgage. For instance, it is also required that borrowers must be under the age of 40 and they will need to put down a deposit of at least 10% of the property’s value.
Kensington aren’t the only mortgage lender who offer specialist loans for people in certain professions. Those who work as lawyers, accountants, doctors, and other very specialist professions can go to lenders including Scottish Widows, Clydesdale Bank and Darlington Building Society. If you work in education, whether as a teacher, lecturer, teaching assistant or a nursery nurse, you could always go to the Teachers Building Society for a special mortgage too.
When you are looking for a new mortgage, it is always worth to see if there are any providers who can offer you a special product related to your profession. It could really help you get your feet on the property ladder!