Mortgage News
NatWest halts interest only for first-time buyers
The Royal Bank of Scotland Group, which includes NatWest Intermediary Solutions, has announced that it will no longer offer interest-only mortgages to first-time buyers.
With immediate effect, first-time buyers looking for a mortgage from the RBS Group will need to take out a capital repayment deal.
Interest-only deals will still be available for borrowers who are not first-time buyers up to 75% LTV.
The move marks a further step in the restriction of interest-only by lenders, as the FSA shows increasing interest in the provision of the product.
A spokesperson for NatWest Intermediary Solutions said: “As a responsible lender, it is prudent for first-time buyers to build up equity in their property by reducing their capital from day one, particularly in times of economic uncertainty.
“Repaying capital from the outset will help to protect first-time buyers from the possible threat of negative equity in the future and ultimately help them to move up the property ladder.”
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