Home Inspiration Blog New 99% mortgage launched for first-time buyers with just £5,000 deposit

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New 99% mortgage launched for first-time buyers with just £5,000 deposit

By Sophia Wood-Burgess

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Yorkshire Building Society has just launched a new mortgage product that would allow first-time buyers to only pay a 1% deposit - that's £5,000 and borrow up to 99% of the property value. There are, however, a few restrictions to consider.

Take a look at our homes on the market that a first-time buyer might purchase with this 99% mortgage:

Homes for sale for £500k or less

mortgage calculator

How much can I borrow? Estimate your maximum loan amount with our mortgage calculator.

Why a new mortgage product matters

There are many Londoners who would love to become homeowners, who can pass the affordability checks and can afford monthly mortgage payments on a home.

However, one of the biggest issues that these particular first-time buyers face is saving up enough to cover that initial 10-20% deposit required for a typical mortgage in London.

What are the details of the £5k deposit mortgage?

• The minimum deposit is £5,000

• The minimum property price is £100,000 and the maximum property price is £500,0000

• The loan is a 5-year fixed rate at 5.99%

• This loan is only available for first-time buyers who will be a maximum of 70 years old at the end of the mortgage term

• This mortgage is only for residential house purchases, not new build property or flats

• Applicants will be required to pass strict credit scoring and affordability checks.

home on the market in London

The market for first-time buyers

It’s big news these days, when an opportunity arises to support first-time buyers getting on the property ladder.

So, although the Government did not introduce a 99% mortgage in the autumn budget statement, lenders are thinking outside the box to help first-time buyers achieve their goals.

If you are working out how to apply for this mortgage, we highly recommend booking a free consultation with our partner broker, Alexander Hall, who can help you prepare and scour London’s mortgage market to ensure you have your choice of the best possible mortgage products for your unique situation and goals.

This product is not alone, the Skipton Building Society’s Track Record Mortgage is going strong, and we have a wide variety of other innovative solutions such as affordability enhancements or parental-assistance to boost the amount buyers can potentially borrow. Speak to an Adviser at Alexander Hall to determine which is best for you.

The London mortgage market for first time buyers

The big picture

This mortgage could help you get on the property ladder, but even if you can’t use this particular 99% mortgage (which will be unfortunately tricky to apply in London), it spells good news for any first-time buyer. The launch of this sort of product demonstrates a level of confidence in the market from lenders, as well as showing a wider commitment to getting first-time buyers on the property ladder.

Getting started as a first-time buyer

Homes on the market for under £500k

Read: Homes for sale for £500k or less: perfect for the new 99% mortgage

• Our latest blog has a selection of houses on the market now for under £500k, which you could browse to start your search.

• Get in touch with Alexander Hall to better understand your budget and make your mortgage application process so much easier.

• Looking for more information about buying a home for the first time? Read these guides:

First-time homebuyer guide: how to get on the London property ladder

Every first-time buyer needs to know these 6 things

Can you get a mortgage on an auction property?

Buying or renting in London: what's easier on your wallet?

• Ready to get on the property ladder now? We can help you get it done fast:

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