YOU ARE THE DIFFERENCE

First Step Mortgage 

The First Step Mortgage has been designed to help First Time Buyers have a home, specifically those who can’t rely on financial help from family. The First Step Mortgage will support First Time Buyers to have a home with as little as 2% deposit of the value of the property.

Like all mortgages, the First Step Mortgage has criteria that applicants will need to meet. So read on to find out who the First Step Mortgage is for.

 

You must be a First Time Buyer – you'll need to fit HM Treasury's definition of a First Time Buyer. 

A first-time buyer is someone who has never owned freehold or leasehold interest in a dwelling before and who is purchasing their only or main residence. Residential property anywhere in the world is counted when determining whether someone is a first-time buyer. Where there are joint purchasers, all purchasers would need to be first-time buyers.

 

You'll need to be a member of The Cambridge - the First Step Mortgage is available to members of the Society who have had personal savings of at least £100 in any product for the 12 months prior to them submitting their mortgage application (for joint borrowers only one applicant needs to meet these requirements).

 

If you have a modest income – we have a cap on the salary requirements of applicants for the First Step Mortgage to make sure we’re helping those with lower salaries, the cap is:

  • Maximum income of £40,000 for sole applicants and £60,000 combined income for joint applicants

 

You must live in our heartland - to make sure we're helping those in our local community, the home being purchased must be within our local area. To cover most commutable villages / towns into Cambridge the area has been defined as:

  • 15 mile radius of our stores and branches. Take a look at our branch map or call the team on 0345 601 3180 with the postcode of the property you wish to purchase to find out whether it’s within the radius

 

You must be able to contribute financially – although we want to help people get into homes we do not want to put people in a position where they are spending above their means and can’t afford their mortgage repayments, therefore normal affordability criteria will apply to each applicant.

 

Products and interest rates

The interest rates for the First Step Mortgage products are the same as the rates for our low deposit mortgages.

 

2 Year Discounted Variable Rate Mortgage

Initial rate Standard variable rate, currently Overall cost for comparison Max LTV Application fee Completion fee
3.24% 5.24% 5.0% APRC 98% £199 £0

With this mortgage you're able to make unlimited overpayments without incurring any early repayment charges. If you switch your loan to another lender, a different mortgage deal with us, make extra payments or repay it in full, you can do so without incurring any early repayment charges.

 


2 Year Fixed Rate Mortgage

Initial rate Standard variable rate, currently Overall cost for comparison Max LTV Application fee Completion fee
3.49% 5.24% 5.1% APRC 98% £199 £0

While in your fixed rate term you can make overpayments of up to 10% of your mortgage balance during every 12 month period without having to pay an early repayment charge.

This 10% overpayment allowance is calculated using the balance of your mortgage at the time it completes. Each 12 month period starts on the anniversary of your mortgage completing.

If you choose a new mortgage deal with us at any point we’ll use this balance and date to calculate your overpayment allowance.

Any amount repaid over 10% of your mortgage completion date balance will incur an early repayment charge equal to:

  • 3% of the excess overpayment in year one
  • 2% of the excess overpayment in year two

 

If you switch your loan to another lender, a different mortgage deal with us, or repay it in full before the end of the fixed rate term, you’ll have to pay an early repayment charge equal to:

  • 3% of the outstanding balance in year one
  • 2% of the outstanding balance in year two

 


5 Year Fixed Rate Mortgage

Initial rate Standard variable rate, currently Overall cost for comparison Max LTV Application fee Completion fee
3.94% 5.24% 4.9% APRC 98% £199 £0

While in your fixed rate term you can make overpayments of up to 10% of your mortgage balance during every 12 month period without having to pay an early repayment charge.

This 10% overpayment allowance is calculated using the balance of your mortgage at the time it completes. Each 12 month period starts on the anniversary of your mortgage completing.

If you choose a new mortgage deal with us at any point we’ll use this balance and date to calculate your overpayment allowance.

Any amount repaid over 10% of your mortgage completion date balance will incur an early repayment charge equal to:

  • 5% of the excess overpayment in year one
  • 4% of the excess overpayment in year two
  • 3% of the excess overpayment in year three
  • 2% of the excess overpayment in year four
  • 1% of the excess overpayment in year five

 

If you switch your loan to another lender, a different mortgage deal with us, or repay it in full before the end of the fixed rate term, you’ll have to pay an early repayment charge equal to:

  • 5% of the outstanding balance in year one
  • 4% of the outstanding balance in year two
  • 3% of the outstanding balance in year three
  • 2% of the outstanding balance in year four
  • 1% of the outstanding balance in year five

Representative example

A mortgage of £229,338.00 payable over 32 years initially on a fixed rate for 2 years at 3.49% and then on our Standard Variable Rate of 5.24% for the remaining 30 years would require 24 monthly payments of £991.69 and 360 monthly payments of £1,219.66.

The total amount payable would be £463,077.16 made up of the loan amount plus interest (£233,515.16), an application fee of £199.00 and a mortgage funds release fee of £25.00.

This example assumes the mortgage funds release fee is added to the loan and that interest is charged on this fee over the mortgage term.

The overall cost for comparison is 5.1% APRC representative.


 

What if I want to move home?

If you move house during the term you may transfer the balance and remaining term of the mortgage to your next home, without penalty. These requests will be subject to our underwriting criteria and the terms can't be extended to any further borrowing if the product has been withdrawn.

What happens at the end of my product?

At the end of the product, your mortgage will revert to our Cambridge Variable Mortgage and you’ll pay our Standard Variable Rate for the remainder of the mortgage term. We’ll write to you when your rate comes to an end to provide you with full details of our Cambridge Variable Mortgage.


If you’d like to find out more about the First Step Mortgage please speak with one of the team today on 0345 601 3180.

 

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE