Created 17th March 2021

First-time buyers have been provided with a new lifeline for their first step onto the property ladder with the re-introduction of 95% loan to value mortgage offers from lenders following the Government’s pledge to back 5% deposit loans in the Spring Budget.

Bradley Hall’s mortgage team has access to the first 5% deposit deal launched by a broker-only lender, meaning it is not available on the market to consumers. The launch comes ahead of the Government backed scheme which is due to launch April 1st.

First Time Buyer at 95% LTV

3.99% + £995 lender arrangement fee

As an illustration – borrowing £142,500, against a property value of £150,000

Monthly repayment - £ 635.36 (based on a repayment mortgage over a 35 year term and with the arrangement fee added on)

Demand for the above is expected to be high, with similar deals historically being taken off market due to an unmanageable volume of applications.

Lenders are now beginning to introduce new 95% loan-to-value mortgage offers to the market following the announcement of the Government scheme which will ensure that buyers have protection from potential losses as they pledge to take on some of the risk of low deposit loans. The ability to purchase a Government guarantee that will reimburse them for a portion of their losses in the event of foreclosure.

Mortgage lenders under the scheme will offer mortgages at a five-year fixed rate, with giving predictability and long-term financial planning abilities for those who wish to purchase on the ultra-low deposit scheme.

The chancellor, Rishi Sunak, said previously: “By giving lenders the option of a Government guarantee on 95% mortgages, many more products will become available, helping people to achieve their dream and get on the housing ladder.”

Chancellor Rishi Sunak confirmed that new ultra-low deposit mortgages would be backed by the government, meaning that homeowners and new buyers will be able to take out a mortgage on a property of up to £600,000 with a deposit of just five per cent.

For more information please contact mortgages@bradleyhall.co.uk or call 0191 260 2000.

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