Mortgage blog: Two more lenders join Help to Buy

Posted 22 January 2014

If you're looking for a low deposit mortgage, 2014 could be the year you finally find the deal you want. New research from the UK's leading chartered surveyor has found that there has been a dramatic rise in the number of low-deposit mortgage loans granted over the last 12 months with the government's Help to Buy scheme partly responsible.

Two more lenders have announced products under the Help to Buy initiative, designed to make more 90% and 95% mortgage deals available to borrowers.

Choice of high loan-to-value deals rises

New research from e.surv, the UK's largest chartered surveyor, has found there has been a steep rise in the number of high loan-to-value mortgage loans - 90% and 95% mortgages - made over the past year.

Richard Sexton, director of e.surv says: "There is still a long road to travel before the mortgage market is fully recovered, but the recovery is quickening and it is now far easier to take out a mortgage with a smaller deposit saved. High loan-to-value lending should continue its recovery in the coming months, but it's important that Help to Buy remains in place to help support borrowers in building a deposit, enabling them to access better rates, and cheaper deals."

Two new lenders join Help to Buy

The research from e.surv comes as two further lenders have launched low-deposit mortgages under the Help to Buy scheme. Santander and the Post Office have joined a growing list of banks offering 95% mortgages with the former offering the first Help to Buy tracker rate deal.

Keith Osborne, editor of Whathouse.co.uk, remarks: "There are now more than half a dozen lenders offering deals under Help to Buy, increasing the choice of products for homebuyers looking for a 95% loan. However, if you're thinking of taking out a low-deposit mortgage it's worth checking out both the Help to Buy deals and the products available from other lenders."

For example, the best Help to Buy deals at 95% are typically fixed rates ranging from between 4.79% and 5.29%. However, The Week reports that the Cambridge Building Society's discount mortgage charges 3.99% interest for the first year, then steps up to 4.89% for the following two years. Norwich & Peterborough offers a 95% mortgage at 4.99% for two years, with a free valuation and £250 cashback.

Osborne adds: "There are a number of 95% deals available outside the Help to Buy scheme and so it can pay to shop around."

Click here to find out more about how Whathouse.co.uk can help you find the right mortgage.

 

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