Stroud & Swindon announced over the weekend an innovative mortgage package to give first-time buyers a much-needed helping hand onto the housing ladder – the 'buy-to-share' option.
The building society's scheme is designed for homebuyers who are happy to let out one or more individual rooms within their property.
These homeowners will be allowed to borrow more, as the building society factors into its lending calculations the amount they will earn from renting out the rooms.
Borrowers will be allowed to add £4,250 to their annual income for the first room rented and £2,125 for a second room.
"Our new 'buy-to-share' scheme takes into account the potential income that can be gained by letting a room," said Paul Chafer, sales director.
The scheme has potential advantages over joint buying, such as the relative ease of terminating the live-in arrangement with the room tenants if things sour on the personal front.
The risks associated with shared buying are frequently cited as a disincentive for young couples who find they can only afford to buy a first home by pooling their incomes, but whose mortgage repayments are complicated if the relationship ends.To read more about first-time buyer mortgages, click here.
© Adfero Ltd