Kensington has launched an income recovery mortgage for borrowers whose earnings have been impacted by the pandemic, as well as a new shared ownership range.

The lender’s new income recovery product is aimed at borrowers who saw their earnings dip by up to 25% during 2020/21 as a direct or indirect result of the pandemic.

Affordability will be based on the average of the past two years’ income and borrowers must have a trading history of at least three years to qualify.

Rates start at 3.38% for a five-year fix at 75% LTV and loans are available up to £1.5m.

Kensington has also brought out a new shared ownership range with rates starting from 4.14% for a two-year fix at 75% LTV or 4.54% for a five-year fix up to 95% LTV of the borrower’s share, with no product fees and free valuations. 

Loans are offered up to £500,000 on both new build and older properties.

The lender says it will consider borrowers who have been gifted deposits by family.

Kensington Mortgages new business director Craig McKinlay says: “Over the last year, many self-employed borrowers have found themselves demoralised from applying for a mortgage, either through past rejections or bearing the financial brunt of pandemic. 

“However, we’re not closing our doors on the self-employed. 

“We’re keeping them wide open. 

“Kensington will lend a hand to some of those hit hardest by the pandemic through the income recovery range.

“The shared ownership range will also help those who want their own space to own it.

“At a time when many have struggled, both products will help make homeownership a reality for those who may otherwise felt it was out of reach after the pandemic.”