The government has stated that a modernised Post Office is to offer mortgages for first time buyers.

This new plan is to commence with the next twelve months from the 11,500-branch strong network of post offices and will include an account designed to help those on low incomes to manage their bills as well as accounts aimed at children.
With over 11,500 branches, the Post Office has more branches than all the High Street banks put together and so could make an ideal neighbourhood bank.

It is anticipated that the first time buyer mortgages will require a 10 per cent deposit and be backed by the Bank of Ireland. This, and the children’s account, are expected to be introduced within a twelve month period with further product, such as a current account, to be added at a later date to be confirmed.

Business Minister Pat McFadden, stated:

“The Post Office can provide a range of good value, simple financial products for everyone. These are the clear messages that people have given us and we are acting on them – a major step towards making the Post Office a sustainable neighbourhood banking service.”

There has long been talk of making the Post Office into some form of neighbourhood bank, and much talk of a mortgage offering. Similarly, now that the UK is seeing the back of the recession, it is possible that other potential mortgage lenders, such as Tesco, may deem the time is right to offer mortgages.

A multitude of mortgage lenders is a good sign for the housing and mortgages market, and good news for mortgage advisors.

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