Low-deposit mortgages are now available to first time buyers and home movers alike and are set to see a lot of buyers benefit over the coming months!
The Coronavirus pandemic has had a huge knock-on effect on the housing and lending market, and has meant that most lenders were not offering much more than 85% loan-to-value, which stopped a lot of buyers from getting onto the property ladder or moving home like they wanted to, and renting has become an increasingly popular option.
But Prime Minister Boris Johnson made a pledge to turn “Generation Rent” into “Generation Buy” and was strongly backed up by Chancellor Rishi Sunak during his spring budget speech. He announced the new 5% deposit scheme, which means that loans up to 95% of the purchase price will be guaranteed by the government on properties up to the value of £600,000. These deals will be available to first time buyers and existing home owners, but unfortunately will not be available on new build properties.
Most of the top high-street lenders are on board with the scheme, and the hope is that more will follow. The scheme will run from April 2021 until the end of December 2022, and with the Stamp Duty Holiday soon coming to an end, this scheme offers another incentive for people to buy property!
Your individual circumstances will dictate exactly how much you are able to borrow. That affordability will then give you a guide as to what your property budget is and therefore how much of a deposit you will need. Use our calculator tools to get a rough idea of your affordability or speak to an advisor to get more accurate figures!