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Brokers say key worker scheme fails London buyers

Brokers have criticised the government&#39s key worker living scheme, arguing that it does not go far enough to help key workers meet the inflated property prices of the South-East.

The scheme offers several options including equity loans of up to £50,000 to help key workers buy a home on the open market or a new property built by a registered social landlord.

But Mark Osland, director of Croydon-based Fidelius, says this still leaves many properties out of reach of key workers. He says: “The more you can borrow yourself, the less the government will lend you. This makes it difficult to hit the kind of figures you need to buy a home, especially in the London area.”

Osland has been approached by three clients over the past few weeks wanting to take advantage of the scheme but none have been able to borrow enough to buy a property.

Trevor Youens, director of Reading-based IFA firm Flower, is supportive of the scheme but says borrowers may get a shock when they come to sell their properties.

He says: “If the property has appreciated in value by 30% since it was bought, the borrower will have to pay the government a sizeable sum when they come to sell. There is bound to be bad press when that starts to happen.”


The Mortgage Mole

Losers “What a shambles” “A complete farce” “Sweet FA to do with this market”. Just some of the comments made to Mole following the hilarious efforts of a certain publishing company to host their first &#39Mortgage Awards&#39 at London&#39s Quaglino&#39s restaurant last Wednesday. With lenders picking up awards for sectors they don&#39t operate in and […]

CA exposé excluded brokers

No IFAs or independent mortgage brokers were included in the survey by the Consumers Association for Which? that accuses the financial services industry of being “rife with poor advice and questionable sales tactics”. The year-long undercover investigation, the results of which were published last week, limited its research to 39 banks, building societies and estate […]

Northern Rock launches new product range

Northern Rock has introduced new rates on its two and three year flexible fixed rate products. Available with no extended early repayment charge, they now start from 5.19% and 5.89%. A two year flexible fixed rate is also available with a one year extended ERC and rates starting at 4.99%. The new range will be […]

Packagers have no choice when it comes to regulatory status

Letter of the weekFrom Chris GardnerLast week&#39s editorial and lead story on page 4 (Mortgage Strategy May 31) made for interesting reading but one thing bothers me: it appears that many in the mortgage market are unable to grasp the fact that to be regulated by the FSA you have to be carrying out a […]


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