The Intermediary – March 2026 - Flipbook - Page 50
ING
FLEXIBLE LENDING
FOR FIRST-TIME
BUYERS
head, head of
Paul Broadhead,
using
mortgages and housing
ieties
at the Building Societies
Association (BSA)
F
or many first-time buyers (FTBs), raising
a deposit remains the main barrier to
homeownership. 64% cited it in the latest
BSA Property Tracker Survey.
Building societies are FTB specialists,
and their flexible approach and innovative products are
helping more people responsibly escape the rental trap
by providing a range of FTB products, including low or
no deposit mortgages, to those who can afford to buy.
As lenders continue to innovate, we are seeing how
flexible mortgage products, including 100% loan-to-value
(LTV), are addressing the deposit barrier and unlocking
"Mortgage? I wish! I've just
paid off my student debt"
the benefits of homeownership for many.
Since 2023, when Skipton Building Society launched
its Track Record mortgage, there has been availability
of no, or very low, deposit mortgages. Still classed as
niche, with strict eligibility criteria ensuring responsible
lending, they are not suitable for all borrowers, but it
is clear there is a place for them in the market – for
example, for those borrowers who can afford a mortgage
but do not have the family support to help them raise a
large deposit, or those already paying high rental costs
making additional saving difficult.
The flexibility offered from the building society sector
is not about pushing borrowers beyond their limits or
approving loans that cannot realistically be sustained.
Responsible lending remains central to building
society underwriting.
The emphasis is on understanding the borrower as an
individual, assessing their affordability and supporting
sustainable homeownership over the long-term.
In 2025, a welcome regulatory shift began that is now
rebalancing mortgage rules to adapt to today’s borrowers
and those in the future.
We have consistently highlighted the need for a
broader perspective when comparing the customer
outcomes of homeowners with those remaining in
rental accommodation.
The Government is clearly supportive of mortgage
regulatory reform to support more people into
homeownership; however, successive Governments have
underbuilt for decades, and it is now essential that
supply side issues are addressed alongside regulatory
reform and lender innovations.
tend to be modelled over medium or long-term
fixed periods – meaning owners looking to move
or sell within that time may face negative price
movements, as well as early repayment charges.
Advice matters, too. Emily Franks, director at
Emily's Mortgage Services, says: “I do not think
these should ever be execution-only products and
clients should be advised appropriately of the
risks involved.
“The risks naturally include clients falling into
negative equity, and clients need to be made fully
aware of why this matters and what it means.
“The property market is still volatile, in my
opinion, and the past few years have shown us that
things can change at a moment's notice.
"These products could mean a client is trapped
in their home and unable to move if their
circumstances change.”
Darren Deacon, head of intermediary sales at
Family Building Society, argues that equity is not
the main driver of borrowers defaulting – income
shocks are, adding: “If the borrower can’t afford
the payments, a high LTV alone doesn’t cause
the default. And these products are, of course,
regulated and subject to Consumer Duty.”
