If you are a first time buyer, the last couple of years have been tough. A sharp reduction in the number of mortgages available to people with a small deposit coupled with ever increasingly strict underwriting criteria mean it has been difficult to agree a mortgage.
Now, however, there is some good news as research has found that more high ‘loan to value’ mortgage deals are now available – perfect for those buyers with a smaller deposit.
Number of low deposit deals has ‘shot up’
The Daily Mirror reports that ‘there are currently 214 deals available for those with 10 per cent deposits, compared to 144 in February 2010.’
If you have a 15 per cent deposit then you have even more choice, with 560 mortgage deals to choose from. This is up over 80 per cent on the same time last year.
Average fixed rates also lower than 2010
The newspaper also reports that despite fixed rates creeping higher and higher in the last few weeks, they are still lower than 2010.
The average rate for a two-year fix on a 90 per cent mortgage is currently 6.09 per cent, compared to 6.48 per cent in 2010. If you have a 25 per cent deposit, the average fixed rate is now 4.03 per cent compared to 4.27 last year.
Louise Holmes from Moneyfacts.co.uk said: “Lenders became risk averse during the height of the credit crunch, withdrawing higher loan-to-value products.
“Over recent months some have increased rates and expanded their number of deals, giving indications the market could be returning to a competitive, rather than risk-based state.”
If you are looking to borrow 90 per cent of the property value, the Daily Mirror highlights a two year fixed rate at 5.45 per cent (£99 fee) with Santander. HSBC also has a 90 per cent deal at 5.49 per cent, although this has a fee of £999.
