Danske Bank is launching a 95% mortgage for first-time buyers and home-movers as housing market demand grows.

Applicants must be in permanent contracted employment, with an individual or joint income of over £40,000. It applies only to homes with a value of up to £500,000.

Danske Bank indicated that a furloughed employee would be excluded if applying as a sole borrower. But they would be considered in a joint application with someone who was not on furlough,

Bank of Ireland UK launched a 95% offer last week that is also available in Northern Ireland, while Ulster Bank launched a 90% home loan in December.

The deals are part of an easing of mortgage conditions after limits imposed at the outset of the pandemic over fears of a fall in house prices.

Lockdown and home-working has led to growth in the market, with prices rising 5% year-on-year to an average of £147,593.

Danske’s new product has a two-year or five-year fixed rate of 4.40% with no product fee.

Aisling Press, managing director of personal banking at Danske Bank, said: “As one of the biggest mortgage lenders in NI, we are very pleased to be offering mortgages with as little as a 5% deposit.

“Danske Bank is committed to helping NI grow by supporting businesses and our personal customers as they seek to achieve their ambitions. Despite the unprecedented challenges facing our economy, the housing market has remained robust, with demand from prospective buyers at healthy levels.

“This new 95% loan-to-value mortgage product brings forward another option for those seeking to realise their aspiration of home ownership.”

A spokesman for AIB, another major lender in Northern Ireland, said: “In February of this year, we launched a 90% mortgage for first-time buyers, and there has been strong uptake among our customers to date.

“We continue to keep our product offering under review.”

A spokesperson for Ulster Bank said it had seen “strong demand for our 90% mortgage and continues to lend to a wide range of borrowers including first time buyers, home movers and those remortgaging”, adding: “We continue to keep our product offering under review.”

Source: Belfast Telegraph