New 95% mortgage scheme launches
A new government-backed mortgage scheme will help first time buyers or current homeowners secure a mortgage with just a 5% deposit.
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95% mortgage guarantee launches today, available on high streets across the country
Scheme part of a range of ownership options to help make home ownership a reality
New figures show demand for home ownership has soared during lockdown, with nearly 80% of private renters now saving for a deposit
Today’s launch further strengthens government commitment to supporting the housing sector
A new government-backed mortgage scheme to help people with 5% deposits get on to the housing ladder is available to lenders from today (19 April 2021).
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Becoming a homeowner is definitely more than a little bit confusing (why didn t they teach us about credit scores, mortgages and interest rates at school, please?) but it s fairly commonly known that a key barrier to getting a foot on the housing ladder is the need for a large upfront deposit.
Typically, prospective homeowners need to put forward a deposit of at least 10% of the property s overall price, although ideally up to 15% or more, if possible. Given we re in an age of inflating property prices and a lack of truly affordable housing, this chunk of money needed upfront can price many people out of owning a home. We re not called Generation Rent for nothing.
Credit: PA Archive/PA Images
Home buyers with deposits as low as 5% will find more deals available from Monday, as a new UK Government-backed mortgage scheme gets under way.
Several of Britain’s biggest mortgage lenders are turning on the taps to boost the supply of low deposit home loans, under an initiative unveiled in the Budget.
The Government scheme is being made available to lenders from Monday.
Lloyds, Santander, Barclays, HSBC UK and NatWest will be among the first to launch mortgages under the scheme, with Virgin Money following next month.
The number of low deposit mortgages on the market shrank dramatically in the early days of the coronavirus pandemic, as lenders became much more cautious about offering “riskier” loans in the tough economy.
However, analysis by the Guardian has found that single buyers in their 30s on the UK median wage will still be locked out of buying a home in about half of local authority areas in England and Wales.
Although two salaries will make it easier to raise a large mortgage, those on the UK median earnings for that age group will be unable to afford to buy a home in all of London and parts of the south and east.
The analysis looked at the cheapest types of property available in each local authority area, typically a flat or terrace house, and used median prices for those and median earnings for borrowers in their 30s. Official figures put the average age of a first-time buyer at 32.
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