Stuart Haire, chief executive of Skipton Group said: “I can confirm we’re developing a mortgage product to enable people trapped in rental cycles – where they’re prevented from being able to save for a house deposit – to access the property ladder and make a home.
“There are too many people who are trapped in rental cycles. These include people who have a decent history of making rental payments over a period of time and can evidence affordability of a mortgage, yet their only barrier to becoming a homeowner is not being able to save enough for a deposit and through lack of access to the bank of Mum and Dad.”
Haire added: “We know there isn’t one quick solution to addressing this huge societal challenge of tenants being trapped in renting cycles, with rents escalating faster than mortgage payments and the increasing costs of living, but doing nothing isn’t going to solve this issue. As a building society it’s been our purpose for 170 years to help people into homes. So, we’re ensuring all these considerations and more are going into the development of our new product. We’re carefully looking at how we can best tackle the challenges that generation rent are facing, together with managing the potential risks and challenges they may face in the future too.
“We know this product will not be able to help everyone and is only part of the solution for this group of people, but as a lender, we’re taking a stand to offer innovation in this space to help more people become first-time buyers.”
Considering rental history
This follows a report from The Times this morning, which stated that the mutual was looking at launching a product which will take a borrower’s historical rental payments into account and remove the need for a deposit.
It also comes after a statement made to Mortgage Solutions in March, where Haire told the publication: “There are an awful lot of people renting where actually a mortgage will be cheaper. Those people have evidenced affordability over the likes of three years, so they’ve been paying. Why can’t we use that?
“Obviously, we have to do full affordability checks but ultimately, that’s a great track record so we’re thinking about that space.”
A spokesperson for Skipton Building Society said further details on the product would be announced in due course.
