The fixed rate loan will be offered at 4.99% until 2015.
Under the mortgage indemnity scheme, the property firm pays 3.5% of the purchase price of a home into a fund, with additional security provided by the government. This encourages lenders to offer mortgages at a higher loan to value ratio than through a conventional mortgage product.
Linden is offering buyers with 10 to 15% deposits more favourable fixed rates of 4.49% and 3.99% respectively.
The developer is also launching another mortgage product, ‘Deposit assist’, with Hitachi Capital. This allows buyers to take out an unsecured loan amounting to 15% of the purchase price to build on a 5% deposit.
Ian Baker, group managing director at Linden Homes, said: “Affordable, responsible lending is critical in helping to boost not only the house building industry, but the wider economy.”