The lender said this would give borrowers flexibility when buying a property at a discounted price from a family member or purchasing their current rental home from their landlord.
The change reduces the seller discount needed for eligible purchases from 25% to 15%, meaning the buyer borrows the full discounted purchase price.
Under a concessionary purchase, the difference between the property’s full market value and discounted purchase price can act as the buyer’s deposit. Eligible buyers can borrow up to 100% of the discounted purchase price, including fees, subject to a maximum of 85% of the property’s full market value and applicable lending criteria.
Paul Adams, director of sales at Pepper Money, said: “A close family member or landlord may be willing to sell at a discount, but a 25% reduction can be a significant concession. Increasing our maximum LTV to 85% means eligible buyers borrowing the full discounted purchase price can proceed with a smaller concession from the seller.
“For brokers, it provides another option when helping customers whose circumstances do not fit a conventional purchase.”
Why new-build property investment is appealing to a new generation of landlords
Sponsored by BM Solutions
The new 85% LTV maximum is available now, subject to Pepper Money’s usual affordability, credit and lending requirements.
