NatWest Intermediary Solutions will reintroduce residential interest-only mortgages for new business from Monday 21 September.
However, they will only be available to customers who fulfil specific eligibility criteria.
They will also be reintroduced to NatWest’s retail channels.
Customers who want to apply for an interest only mortgage must fulfil specific criteria including:
- Earn a single gross annual income of at least £100,000, excluding discretionary bonuses
- Have an acceptable repayment strategy
- Take a maximum loan to value (LTV) of 75%, with further restrictions if the customer intends selling their home in order to repay the loan
There are specific circumstances where customers will not be accepted for an interest only mortgage:
- Where they plan to repay their mortgage within three years
- If they want to use the mortgage to consolidate debt
- If they are applying through one of the Help to Buy or shared equity schemes
- If they live outside the UK or have no right to reside in the UK
Graham Felstead, head of NatWest Intermediary Solutions, said: “We are delighted to be reintroducing residential interest only mortgages for brokers and their customers. Having undertaken a thorough review of the market, we believe we can help many customers, who meet specific conditions, with their home ownership needs with interest only mortgages.
“Customers who take this option will need to have approved repayment strategies in place and agree to engage with us during the loan period so that we can support them to stay on track to repay the loan.
“The mortgage market is currently a very dynamic one which is set to continue on its growth path. We have enjoyed great support from the broker market this year and look forward to continuing to help more and more customers with their borrowing needs for the rest of 2015 and beyond.”
