We have launched the “highest affordability” ¹ mortgage in the market to first-time buyers.

We’ve officially opened up our flexible long-term fixed rate product to new purchase customers and first-time buyers, within our pilot to selected borrowers.

We will lend up to 95% LTV, with fixed-rate terms up to 40 years, helping borrowers lower their monthly payment amount. We will also lend up to six times a borrowers’ income, subject to criteria, which could act as a significant lending boost for many first-time buyers who consistently struggle with affordability.  

A longer fixed rate term allows many borrowers a higher affordability boost compared to those on a short-term fixed rate mortgage. This is because of the way current mortgage products are designed which place all the market risk on borrowers. Once this is removed, through fixing the rate for the entire term, first time buyers could borrow more. This is the innovation we offer. 

For example, on a £60k joint income, a first-time buyer could borrow up to £355k with us, which is about £70k more than the closest high street lender.2

This could make a massive difference for first time buyers. As a result, borrowers looking to maximise their borrowing responsibly should consider a longer-term fix compared to a shorter-term fix like a 2 year or 5-year fixed rate mortgage.  

 The product also only carries declining early repayment charges (ERCs) for the first five years, making it highly flexible. This gives borrowers certainty that their payments will never increase, as well as allowing them to change when the time is right for them. 

Colin Bell, COO & Co-Founder of Perenna comments:  

“We’re really excited to open up the Perenna Mortgage to first time buyers and new purchase customers. First time buyers are constantly struggling to get onto the housing ladder due to affordability issues – whether that’s saving up enough for a small deposit or being able to borrow enough to afford a home they really want. The Perenna Mortgage is the complete mortgage product – increased affordability combined with long-term stability and flexibility.” 

Arjan Verbeek, CEO & Co-Founder of Perenna comments: 

“We believe in unlocking the power of homeownership without having to sacrifice the amount you can borrow – borrowers should be able to have both their cake and eat it. As we remove market risk from borrowers, customers can borrow what they actually can afford, which in some cases can be on average up to 30% higher than the high street lenders.3 With our full unrestricted UK banking license and recent funding round, we are ready to deliver the much-needed changes in the UK mortgage market, and start delivering better outcomes for homeowners across the country.” 

How much can you borrow?

Want to find out if Perenna could help you? Why not use our calculator to find out how much you could borrow? It’s completely confidential, does not affect your credit score and should only take a few minutes. If you’re eligible to apply, the quote will also let you know how to access a Perenna mortgage.

You could lose your home if you don’t keep up your mortgage repayments.

Notes:

• Footnote 1 – “Highest affordability” defined as highest borrowing amount by use of intermediary mortgage affordability calculators across leading high street lenders2, as at 13 November 2023 
• Footnote 2 – “Leading high street lenders” defined as those who control 75% of the market by gross lending during 2022 – MM10, UK Finance (as at 13 July 2023) 
• Footnote 2 – “Leading high street lenders” defined as – HSBC, Natwest, Nationwide, Santander, Virgin Money, Lloyds Banking Group, Barclays 
• Footnote 3 – Data chart, see below, as at 13 November 2023:

All information correct at time of publication

Are you saving up for a deposit or thinking about managing your money better? Then this blog post is for you.

We recently interviewed Charlotte Jessop, also known by her Instagram handle “Looking After Your Pennies”, about financial education, green investing, and her journey from maths teacher to finance blogger with thousands of followers.

How did your time as a teacher equip you to life as a finance blogger?

My background is as a maths teacher. When I was teaching, I needed to put maths into real-life situations to provide context to the learning, but textbooks always use simplified and unrealistic scenarios. While applicable at a basic level, it’s not particularly relevant to real-life.

For topics such as compound interest on the maths curriculum, I would look at how this works in the stock market as an example, or how it works for depreciating assets, like a car, to provide actual practical knowledge to the students I was teaching.

I even invited a financial adviser for a couple of lessons with a challenging class. I’ve never seen my students listen so intently or ask so many questions. That moment was an epiphany – it was clear to me that not only is there a need for better financial education, but there is also a thirst for this type of knowledge.

The result? Well, I decided to marry the worlds of teaching and learning about finances creating Looking after your pennies – the fact that it’s proven so popular shows there is so much demand for this type of information to be easily accessible.

What do you aim to achieve through the Looking After Your Pennies platform?

My mission is to educate as many people as possible about their finances.

I’ve observed that my followers usually fall into one of two categories:

1. They’re oblivious as to how money works, or
2. They’re willing to pay someone else to look after their finances for them.

I aim to create a healthier middle ground where money management becomes a simple task and empower people to make confident decisions about their money with good information to back it up.

How do you think the pandemic has impacted people’s financial wellbeing?

Ultimately, this depends on who you ask. For some, lockdown life on furlough meant they were spending less and saving more. For others, it’s been a stressful time with job insecurity and financial challenges.

The universal component here is that everyone has learned something about their finances – either their saving potential or the fragility of their current financial situation.

How has the advice you’ve given changed since the beginning of the pandemic?

As things got worse during the pandemic, including the economy and finances, the need for Looking after your pennies just increased. When we first started the blog, it was more about providing people with practical tips to help them save money. Then, at the peak of the pandemic, it was all about helping people survive this challenging time.

Now, people realise that we’re heading towards tougher times as energy prices rise, inflation reaches higher levels and national insurance contributions increase. Many people may now need to readdress their finances, make a bit of extra cash, and look to maximise their savings.

What type of guidance do you think people will be looking for this year?

Our lives have been on hold for the past two years, but we can’t be stuck in our pyjamas forever! With restrictions easing, people will want to start travelling again, and I expect many will be trying to find out how they can best save money for a holiday.

At the same time, we’re moving into an unprecedented time for many consumers. Inflation is high, and interest rate rises are now a reality. I bought my home in 2012 when interest rates were 5%(considered good at the time) compared to today’s incredibly low interest rates.

We’ve become so accustomed to this low interest rate world, and there’s a whole generation of people who have never seen rates at 5% or more. These individuals will need to know all about what rising interest rates mean for them and what to do if they are planning to step on the property ladder or remortgage, for instance.

What do you think is the best first step for someone wanting to rejuvenate their finances?

Every time I get the ‘I’ve fallen off the financial wagon’ feeling, I go back to writing down my income and expenses. The action of writing down what I earn shows me exactly how much I’ve got to enjoy, while setting out my expenses tells me what I’m doing with that income. This simple exercise can help find the disconnect between intentions for money and what really happens.

How can I deal with my finances and be eco-friendly?

I love this topic because I’m quite lazy and like to do things that are good for the environment without having to do the small things, like washing out our jam jars. What I mean by that is I like to make financial decisions that have a positive impact and that make you feel good about your efforts to support the green agenda.

I’m open about the fact that my pension and investments are in ethical places. I think it’s sensible to put my money in places that are making positive steps towards tackling climate change without me having to slog over the small things.

As far as I’m concerned, anything green or eco-friendly is the future. There’s going to be a point where we can’t use these finite, fossil-fuel resources anymore. I’m not worried about this being a fad either, so I might as well make a start by taking steps to support green initiatives.

Having your pension invested in something green has a much more significant impact on CO2 emissions than things like reducing your travel on planes, going vegan, taking the bike to work, or reducing your water consumption. If you put your money into an ethical pension fund, rather than just leaving it where your boss thinks it is giving a good return, not only is it having a much more significant impact, but you can feel like you are playing your part in tackling climate change too!

Want to find out more about how you can improve your finances? Click here to visit the Looking After Your Pennies website.

Correct at time of publishing.

Getting on the property ladder in the United Kingdom is difficult. Having a suitable deposit and being able to borrow enough are challenges for many first-time buyers and home movers. At Perenna, our mission is to change that.

When we have secured our banking license, it’s our ambition to introduce 95% LTV (“Loan to Value”) mortgages with a fixed for life interest rate along with flexibility that puts you in control. This blog post explains what a 95% LTV mortgage is, why some lenders can’t offer high LTV mortgages, and why Perenna will be able to when we get to market.

What is a 95% LTV mortgage?

A 95% LTV mortgage is a loan where you take out a mortgage for 95% of a property’s value. This way you only pay a 5% deposit to buy a home. For example, to buy a house worth £300,000, you would only have to put down £15,000. The 95% LTV mortgage is generally attractive for first-time homebuyers who struggle to save for a deposit.

Why is there so little supply in the market?

The main reason lenders don’t offer high LTV mortgages is that they fear house prices will go down in the future. If you default and the house price falls below the loan amount, the lender cannot recoup the loan by selling the house and thus loses money.

How can Perenna offer 95% mortgages?

To offer 95% mortgages, lenders must ensure that you can repay the mortgage. At Perenna, we do that through a strong focus on affordability and by offering fixed for life mortgages.

Fixed for Life mortgages are mortgages where you pay the same amount for the entire term of the mortgage. Making it easier for you to budget payments and reducing the risk of default.

Correct at time of publishing.