The 100 per cent mortgage is back, after Skipton Building Society last month launched a no-deposit deal aimed specifically at first-time buyers, with a five-year fixed rate of 5.49 per cent.
It’s a move that could spell good news for many first-time buyers, according to housebuilder Bloor Homes – but people need to check they meet the criteria before they apply.
The monthly mortgage payment cannot exceed the applicant’s average monthly rent from the last six months, and they must also prove a good credit history.
Mark Powell, Group Sales and Marketing Director for Bloor Homes, said: “The return of the 100 per cent mortgage will absolutely be a positive thing for many first-time buyers, enabling them to buy a home much quicker than they may have previously thought possible.
“There are many parts of the country where rent and mortgage payments are about the same for a similar property, so this will be a fantastic deal to take advantage of for those people. Getting on the property ladder and investing in your own home is a smart long-term move.
“However, there are some parts of the country where an average rent payment is likely to be significantly less than an average mortgage payment for a similar property, meaning that to take advantage of Skipton’s deal, some buyers may have to ‘trade down’ to buy a home.
“There are many people who will be happy with that, because after all, mortgage payments go towards full ownership of your own home while rent payments pay for the landlord to own the rental property.
“So, our advice to first-time buyers is this: do your research and make sure that a 100 per cent mortgage will benefit you. If you decide it’s the deal for you, we have sales managers all over the country who are ready and waiting to welcome you, to find your ideal first new home.”
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