Post Office courts first-time buyers with 90% LTV interest only deal

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The Post Office has launched new mortgage deals with first-time buyers in mind.

The lender is not only happy with a minimum deposit of 10% but is also allowing borrowers to choose between an interest only and capital plus interest repayment option.

For a two-year fix the rate is 5.45%, for a five-year 5.99%, and both loans come with an application fee of £999.

A three year fixed-rate at 5.99% and a lifetime tracker at bank base rate plus 4.99% (currently 5.49%) are also available.

Backed by the Bank of Ireland, the Post Office fully entered the mortgage market last year with the aim of taking its place among the UK’s top ten lenders.

The new offering is therefore being seen as a wake-up call to its established competitors, which generally shy away from interest only options on deals with loan-to-value ratios of 75% and above.

For those keen to sign up, mortgage applications are accepted at Post Office branches, by post, phone and online.

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