TMW launches new range of guarantor products

The Mortgage Works (TMW) has launched guarantor mortgage products with different levels of liability.

The range includes limited liability deals for those wanting to guarantee a smaller proportion of a loan and full liability deals for those able to provide support for the mortgage.

The products with this limited liability feature include a 3.99%, two-year fixed-rate product with a 2% arrangement fee available up to 75% LTV, a 4.99% two-year fixed rate with no arrangement fee available up to 75% LTV and a 5.99% three-year fixed rate with no arrangement fee and £1,000 cashback, available up to 75% LTV.

With the limited liability products, the applicant must be able to afford at least 70% of the loan amount when applying. The guarantor must be able to afford the shortfall, a maximum of 30% of the debt, plus a further 10% tolerance. However, for the full liability products, guarantors need to be able to afford the entire mortgage as well as keeping up with existing commitments such as their own mortgage.

The full liability products include a 3.49% two-year fixed-rate deal with 2% arrangement fee, available up to 75% LTV and a 4.99% two-year fixed-rate deal with a 1% arrangement fee, available up to 80% LTV.

With a requirement for a low deposit of 15%, the lender said the guarantor mortgage range will be suitable for graduates who are likely to see their income increase over time, allowing the guarantor to be removed from the mortgage at a later date.

Tracie Pearce, head of products at The Mortgage Works, says: “The new range of guarantor mortgages offer choice and flexibility for guarantors and first-time buyers. Many lenders have guarantor propositions but very few offer products specifically designed to cater for this sector. The Mortgage Works is delighted to support the housing market, helping first time buyers get a foot on the housing ladder.”

The launch comes hard on the heels of Halifax's decision to withdraw its guarantor products.