Newcastle Intermediaries is now allowing residential lending on properties under a Section 106 agreement (S106).

An S106 describes an obligation for a developer to help fund the improvement of the local area around a new project when said project is believed to have an impact on the surrounding infrastructure, such as the provision of school places or parking spaces.

The lender believes that bringing S106 housing into its criteria will help first-time buyers.

Head of intermediary mortgages Franco Di Pietro explains: “Clients looking to borrow on a Section106 property have limited options.

“We’re absolutely committed to helping people onto the property ladder, and continually reviewing our underwriting approach across all areas, to meet customers’ needs.

“In response to broker feedback we’re pleased to enhance our lending criteria to include properties with a S106 agreement in place and confident that it will make a real difference to brokers and their clients, especially those looking to make that first big step into home ownership.”

Early last month, Newcastle Intermediaries brought out 95% LTV three-year fixed rate products, starting at 3.80%.