Accord Mortgages has added interest-only residential mortgage repayment options to its range as of today.
The intermediary-only arm of Yorkshire Building Society is offering interest-only options to new borrowers seeking up to 75 per cent loan-to-value who could afford to repay the loan on a capital and interest basis but are choosing to only pay the interest accrued.
The move was first mooted exclusively by Mortgage Strategy earlier this year.
To meet the newly introduced lending criteria, Accord requires borrowers to demonstrate they have an acceptable repayment strategy in place at the end of the mortgage term, which could include existing endowments or savings and investments.
The lender will allow the sale of the mortgaged property at the term end to be used as a repayment strategy, where the amount borrowed against this strategy does not exceed 50 per cent LTV and where there is a minimum of £200,000 equity within the property.
Accord managing director Charles Canning says: “We’re pleased to add interest-only repayment methods to our Accord mortgage range.
“Demand for interest only mortgages is increasing and for borrowers who have made an informed decision that this repayment method best meets their needs, and who have a clear strategy to repay the loan, we understand the additional flexibility it can provide.
“As a responsible lender we have designed a lending policy that reflects the needs of borrowers and meets those needs in a financially sustainable way. We’re confident the introduction of interest only options will be welcomed by brokers and borrowers looking for choice in the market.”
Canning says dedicated interest-only underwriters have been appointed to answer broker questions.