First-time Buyer  

Bank of Ireland and Post Office roll out new mortgages

Bank of Ireland and Post Office roll out new mortgages

Bank of Ireland UK and Post Office are rolling out two new mortgage products to help first-time buyers and older borrowers.

The bank is launching two new loans following customer research, which found top priorities were helping children get on to the property ladder and later life borrowing.

Richard Rowntree, managing director at Bank of Ireland UK Mortgages, said: "We have undertaken extensive customer research to understand what aspects of the mortgage market are not working for our customers."

Post Office Family Link will allow customers who have good affordability but are struggling to save a deposit to get on the housing ladder. The product should particularly appeal to those in rented properties who can afford monthly repayments but may not be able to build up money for a deposit.

The new product will allow them to raise a 10 per cent against a close relative’s property if they don’t have a mortgage. Post Office said this would allow parents who may not necessarily want or be able to gift a deposit to help their child onto the property ladder. Loans are available up to £500,000 and borrowers must never have owned a property before.

Post Office Retirement Link lets retired borrowers take out a residential mortgage and use a portion of their pension to help fund it.

The product will have capital and repayment or interest-only options, with customers able to borrow up to £500,000. Interest-only customers can borrow up to 30 per cent loan-to-value up to age 80, while capital and repayment customers can borrow up to 50 per cent LTV up to age 90.

Owen Woodley, chief executive of financial services and telecoms at the Post Office, said: "The launch of these two new products will help customers enjoy and make the most of their lives by solving the very real challenges we know they’re facing today."

As well as the new launches, the providers are expanding their intermediary distribution network, which currently only has Legal & General Mortgage Club as a distribution partner.

Post Office for Intermediaries will be offered to major distributors and networks. A roll-out of the service is expected to be completed by the end of June.

damian.fantato@ft.com