95% mortgages on the up

The introduction of the ‘Help to Buy’ mortgage scheme three years ago, allowing hopeful buyers with a five percent deposit to secure a 95% deposit have blossomed, with the amount of lenders offering this option increasing hugely since the initial introduction.

When the scheme was introduced in 2013, there were 56 lenders offering 95% mortgages, whereas in June 2016 271 lenders are prepared to lend to this value.

Research by Moneyfacts has revealed that more and more first timers are choosing to go down this route, with house prices climbing, more people are finding that a smaller deposit is a more viable financial option for most.

Buyers in London and the South are the biggest borrowers, taking on the largest mortgages available –with London borrowers requiring more lending in relation to their income. According to credit agency Moody’s around 70 percent of first-time buyers borrowed more than 3.5 times their income, compared to 54 percent of veteran buyers.