The number
of 95% mortgages available has soared five-fold since the Help to Buy scheme
was launched at the end of last year. The number of products has jumped from
just 56 in October 2013 to 271 today, according to Moneyfacts.
If you’re a first-time buyer, a 95% mortgage is likely to appeal to you as it means you only need a 5% deposit. But 95% mortgages come with risks, and lenders usually have stricter rules about who they’ll offer one to.
Lenders are now competing for business in this area, regardless of whether they are taking part in Help to Buy or not. This in turn has led to greater choice, so more products are now available at lower rates.
In the past, some mortgage lenders offered 100% mortgages but to be accepted nowadays, you need at least a 5% deposit. This is great news for first-time buyers, as there is now more mortgage choice for them and they are no longer forced to save huge deposits to get on to the property ladder!
Being able to put down a larger deposit will give you access to more competitive mortgage deals however remember if house prices rise while you’re saving, you could end up back at square one.
If you’re a first-time buyer, a 95% mortgage is likely to appeal to you as it means you only need a 5% deposit. But 95% mortgages come with risks, and lenders usually have stricter rules about who they’ll offer one to.
Lenders are now competing for business in this area, regardless of whether they are taking part in Help to Buy or not. This in turn has led to greater choice, so more products are now available at lower rates.
In the past, some mortgage lenders offered 100% mortgages but to be accepted nowadays, you need at least a 5% deposit. This is great news for first-time buyers, as there is now more mortgage choice for them and they are no longer forced to save huge deposits to get on to the property ladder!
Being able to put down a larger deposit will give you access to more competitive mortgage deals however remember if house prices rise while you’re saving, you could end up back at square one.
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