Owning a home may be within reach for many more Bermudians as the Bank of Butterfield announced the introduction of 95 percent financing.

The bank said yesterday the new policy came as a result of "a general need in the community''.

Vice president and head of retail banking, Richard Doughty, said: "We understand that there are several families who are trying to find a mortgage who don't have the down payment but who do not have the same issues with making mortgage payments.

"We have worked at providing them with the lowest down payment up-front,'' he continued.

"The bank sees this as a positive step toward making home ownership a reality for those willing and able to commit to repaying a mortgage. They can invest in a home at an earlier stage than ever before.'' The 95 percent financing is only available for owner-occupied properties and loans of $600,000 or less.

"This financing will not be available for property investment,'' said Mr.

Doughty, "and is only available for one and two family dwelling units.'' Mr. Doughty explained that the bank has not changed its requirements in respect of what it looks for in a person's ability to pay.

"Although we look at each case independently, we still maintain a debt to value ratio of 45 percent as our guideline. This means that a person's fixed debt cannot exceed 45 percent of their net income.'' The news met with surprise from the Island's two other major mortgage providers, the Bank of Bermuda and Capital G.

The Bank of Bermuda at Press time had failed to respond to the news but requested that The Royal Gazette hold the story until Wednesday. Asked if they were planning to match the 95 percent financing at that time, a bank spokesperson said: "I'll have to get back to you on that.'' Meanwhile a spokesperson at Capital G called the move "extraordinary'' but said it would not result in any policy changes there.

"We have very flexible lending practices here,'' said the spokesperson. "We weigh each case individually but we have given 100 percent and even 110 percent financing to people to buy a home.

"Our policy is if there is a way of doing it we'll find a way to do it,'' the spokesperson said.

"We weigh each case on its own merits and operate accordingly but we have not lost any business to the banks since they implemented their 80 percent financing.'' Capital G use a more lenient 65 percent debt to value ratio for borrowers.

"I suppose that is why the bank has had to go out and do this,'' said the spokesperson. "Obviously we have taken much of their business away. But in the end the consumer gains.'' HOUSING HSG