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Government Help

Kensington to launch Forces Help to Buy

vickyhartley
Written By:
vickyhartley
Posted:
Updated:
09/03/2017

Specialist lender Kensington is set to offer Forces Help to Buy across its entire residential purchase range when the scheme launches next week.

From 1 April 2014 service personnel will be able to borrow up to 50% of their salary to a maximum of £25,000 under the scheme as an interest-free loan to contribute towards the deposit for a home.

Kensington will accept the Forces Help to Buy mortgages across its residential purchase range, which is available up to 85% loan to value.

Alex Hammond, head of marketing communications at Kensington, (pictured) said: “Lending decisions at Kensington are not made by an automated system, but by experienced underwriters who are able to consider more complex circumstances that may cause applicants to fail a credit score elsewhere.

“This means we offer a good choice for services personnel who may have moved frequently with their post or spent time out of the country that has had a detrimental impact on their credit record.”

Rob Killeen from Capital Fortune, a specialist mortgage broker, said: “The challenge with finding mortgages for forces personnel is that they are often not found on the electoral roll and frequently have limited credit as a result of being out of the UK.

“This means that they can fall foul of automated credit scoring systems, which can make it harder for them to benefit from Help to Buy as the scheme is predominantly supported by lenders that use automated credit scores.

“Forces personnel are an excellent example of where manual underwriting can help applicants to secure the mortgage they need, and this approach combined with Forces Help to Buy is very good news for all those in our forces who are looking to buy a home.”

Moneyfacts confirmed no lenders currently list Forces Help to Buy products, but Rachel Springall, finance expert at Moneyfacts said once one has launched others will follow.

“It’ll probably be the largest banks which will launch first and I expect the rates will all be of a similar level at first,” she added.

The ‘Forces Help To Buy’ (FHTB) loan is interest free and will be repaid over a period of 10 years. The loan will be available to married, civil partnered and single regular personnel.

Eligibility for the scheme includes being in regular service for two years and have at least six months still to serve.

Should a borrower leave within the 10 year repayment period the balance of the loan will have to be settled. However, in the case of redundancy, the scheme allows personnel to apply to borrow up to 90% of their redundancy lump sum, capped at a maximum amount of £68,000. The loan amount will be recovered from their redundancy lump sum.