The 5% deposit mortgage explained and why we need to listen to Rishi Sunak on home lending. Don’t delay, before jumping in with both feet, let Paula Cook answer your questions.

If you’ve tried to buy a property in the past year, especially if you’re a first-time buyer, you’ll probably know that the number of 5% deposit mortgage options has reduced dramatically.  

In an attempt to reverse this, the latest move from the government is to encourage lenders to start offering these mortgages again. So, if you’ve been sitting on your 5% deposit waiting for your chance, this is your moment! Speak to Paula Cook today.  

In his speech, the chancellor, Rishi Sunak, explained why this is so important, highlighting that “the cost of a deposit [is] a significant barrier to people getting on the housing ladder”. Which, if you’re currently trying to buy a home, you’re probably very, very aware of.  

Under this scheme that started in April, the government covered some of the lenders’ risk on 95% mortgages. It helped potential buyers (both first-timers and old-timers) to buy a property of up to £600,000 in the UK.  

The ‘risk’ involved is the chance that someone who takes out a mortgage may not be able to pay the loan back. Getting 5% deposit mortgages back on the market is a step towards helping open up the property market to more people. However, there are challenges that remain that won’t be solved by this step. For example, many lenders are still using relatively low income to loan multiples, which means they will only let you borrow up to 4.5 times your income in some cases, also the mortgage calculators on a lot of the lender’s sites are not set for 95% mortgages to its important you speak with a mortgage advisor to ensure you know how much you can borrow. In some situations, that is not a large enough amount to purchase an average property with a 5% deposit. So, if you are looking to take advantage of the return of 5% deposit, speak to Paula Cook to find out your options, she can carry out a mortgage comparison for you to find out which lender has the best deals for your circumstances, she can also advise you on the mortgage repayments and show you want interest rates are available on the 5% deposit mortgages.  

Contact Paula Cook today to arrange your mortgage in principle on 07950187868 or fill in the contact me page.