Press Release Summary: A bespoke
mortgage product aimed specifically at buy-to-let
landlords looking to invest in the rapidly growing concept of Private Sector Leasing
(PSL) is being launched by Dunfermline Building Society and Orchard & Shipman plc.
Press Release Body:
news release news release news release
PSL SCHEME GETS DEDICATED BESPOKE MORTGAGE PRODUCT
A bespoke mortgage product aimed specifically at buy-to-let landlords looking to
invest in the rapidly growing concept of Private Sector Leasing (PSL) is being
launched by Dunfermline Building Society and Orchard & Shipman plc.
The bespoke
mortgage, with a starting rate of 6.19% pa for five years fixed,
typical
APR 7.1%, is set to make PSL investment - which has proved to be a huge success
since it arrived in Scotland in 2005 – more accessible.
The first PSL contract in Scotland was signed between Orchard & Shipman plc and The
City of Edinburgh Council (CEC) in September 2005, with the company required to find
1500 properties by 2010.
Such has been the success of the Edinburgh scheme that Orchard & Shipman has already
secured its 1,000th property – two years ahead of target – and the scheme is already
the largest of its kind in the UK.
Andrew Morrison, Director of Policy and Development at Orchard & Shipman, said the
tie-up with Dunfermline Building Society arose after they became aware of
difficulties investors were experiencing in obtaining finance through
conventional
mortgages.
He said: “We have been working hard to raise awareness in the financial sector of
the attractions of PSL investment.
“However, some lenders wrongly had misgivings that the scheme is dependent on
housing benefit being paid or would be a poor investment because of the stigma of
homeless tenants.
“This led the Scottish branch of the Council of Mortgage
Lenders to invite us to
their branch meeting in March which provided the perfect opportunity to explain to
lenders the benefits of PSL, for example, the guaranteed secure rent and the return
of property in good condition. As a result, Dunfermline Building Society, who was
at the meeting, made contact with us about creating a dedicated
PSL
mortgage for
Orchard & Shipman landlords – the first of its kind.”
Simon Cocker, Head of Business Development at Dunfermline Building Society, said:
“As the largest lender to housing projects in Scotland we are looking forward to our
partnership with Orchard & Shipman. The ethos of a building society is to help
people get into their own homes, exactly the same as Orchard & Shipman, so this will
be a very good fit for all parties.
-more-
“We currently have some great deals on the mortgage
market and a reputation for
putting together innovative market leading products, so I have no doubt Orchard &
Shipman clients will be able to make the most of our product offerings.”
PSL allows councils to provide quality accommodation to people who may have lost
their homes through, for example, relationship breakdown or unemployment, and who
would otherwise find themselves faced with temporary housing options such as
expensive B&B accommodation.
PSL appeals to private landlords as it offers the security of guaranteed long-term
income, rents paid quarterly in advance with no voids and no agent’s fees – and the
return of the property in good condition.
A survey of the Edinburgh PSL scheme showed that a phenomenal 96% of tenants and
100% of landlords describe the service as ‘good’ or ‘excellent’ and with 6,000
landlords and investors registering an interest the continuing success of the scheme
seems assured.
Orchard & Shipman has now signed new contracts to deliver PSL schemes with
Midlothian, East Lothian and Scottish Borders Councils, extending the investment
potential outside Edinburgh and making the timing of the new
mortgage launch
crucial.
Orchard & Shipman are now looking at developing further contracts with other
Scottish local authorities, as PSL is expected to play an increasing role in helping
councils achieve achieve Scottish Parliament targets to give every homeless person
the right to a home by 2012.
“Your home may be repossessed if you do not keep up repayments on your mortgage”
ENDS
For more information please contact Suzanne Mackie at the Holyrood Partnership on
(0131) 561 2244 or email Suzanne@holyroodpr.co.uk.
NOTES TO EDITORS:
The PSL mortgage product from Dunfermline Building Society:
• 5 Year Fixed
6.19% fixed until 31/01/2013, £699 arrangement fee
6.59% fixed until 31/01/2013, No arrangement fee, £480 cashback
• 3 Year Fixed
6.34% fixed until 31/01/2011, £699 arrangement fee
6.74% fixed until 31/01/2011, No arrangement fee, £480 cashback
• Full Term Tracker
3 Year Tracker BBR + 0.65%, £699 arrangement fee
Full Term Tracker BBR + 0.34%, £1999 arrangement fee
2009
