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As the average UK house price passes £200,000*, the Teachers Building Society is offering group mortgages for first time buyers across its fixed rate, discount and cashback schemes. Originally established by the National Union of Teachers (NUT) to look after the financial interests of education professionals, Teachers Building Society is an independent mutual building society providing a range of mortgage and savings accounts.
It is increasingly difficult for teachers to afford to buy their first home. Only 20% of people aged 20 to 24 now own their own homes compared to 34% in 1994**. Recent surveys also suggest that first time buyers are stretching themselves further to buy their first property and are borrowing an average of 3.29 times their incomes***. The Teachers Building Society’s group mortgages enable up to four people to club together to buy their first home - only one member of the group is required to be a practicing education professional > Group mortgages provide an alternative way for teachers to get on the first rung of the property ladder without stretching their individual budgets.
Other options available to first time buyers from the Teachers Building Society include the 100% Shared Ownership Plan for Teachers, a rarity in the mortgage marketplace. They allow more teachers to make the most of affordable housing options under the Government’s national HomeBuy scheme, which enables key workers to buy a share of a home. This means teachers can purchase a share of a property with a mortgage of up to 100% and rent the remaining portion from a housing association, increasing the percentage of the property they own as their pay increases.
Another alternative is the Mortgage Guarantor Scheme – a flexible scheme which allows parents to guarantee additional funds over and above those met by their son or daughter’s affordability amount. For example, a teacher earning £21,000 per annum with no commitments would normally be offered a mortgage of £84,000. If the loan required is £125,000 and the parent is in a position to stand as a guarantor the Teachers Building Society will only require them to guarantee £41,000 as opposed to the whole mortgage.
* Department for Communities & Local Government
** Nationwide
*** Council of Mortgage Lenders
