The Local Authority Mortgage Scheme is aimed at local first-time buyers struggling to save for a deposit.
The mutual teamed up with Bassetlaw and Ashfield District Councils earlier this year in order to provide council-backed guarantees of up to 20 per cent on the value of these mortgages.
Gev Lynott, chief executive of Mansfield, said the rate cut should send a clear signal that its commitment to get more local people on the housing ladder is “stronger than ever”.
Details
| Rate will rise by 1.2 per cent after the first three years |
| Minimum loan size is £25,000 |
| Maximum house price allowed under the Ashfield mortgage scheme is £125,000 and the maximum for the Bassetlaw scheme is £130,000 |
| Minimum rate payable of 2 per cent will apply in the first three years |
| Application fee of £199, completion fee of £300 |
| Early repayment charge of 3 per cent in the event of mortgage redemption in the first three years |
| Capital repayments of up to 10 per cent allowed in first three years |
ADVISER VERDICT
Colin Parkin, managing director of Surrey-based Ample Financial Services, said: “Now that prices are escalating, people are wondering how on earth they will get on the ladder so these schemes can only help and the rate does not seem unreasonable.
“But one does not want clients stretching their finances too far and the repayments need to be affordable within their income specifications.”
