The number of 5 per cent deposit mortgage products available is at a post-recession high.
These figures come from London-based insurer Genworth who said the number of 5 per cent deposit mortgage products increased by 84 per cent year-on-year reaching 260 last month – a rise of 119 in the last year alone.
This comes after a recent surge of 5% deposit products for contractors in recent months. Contractor friendly lender Nationwide recently launched a range of 5% deposit products, outside of any current or existing government schemes.
Also this week Buckinghamshire Building Society have recently given Contractor Mortgages Made Easy exclusive access to mortgage funding for contractors - offering a 5% deposit option to contractors with no minimum income and just a 6 month contracting track record.
Simon Butler, Associate Director at Contractor Mortgages Made Easy, said: “Lenders opening their doors to contractors with a 5% deposit gives a good indication of firstly the influence that we now have in the market, but also the perception of contractors to lenders. It is also clear that the Help to Buy mortgage guarantee scheme has injected life into the low deposit market.”
“We have worked tirelessly for many years to change banks perception of contractors. With the recent development at Buckinghamshire Building Society, there have never been more lending options for contractors.”
Last month Chancellor George Osborne announced that first-time buyers in London will be given a support through a 40% interest free equity loan with the launch of Help to Buy London in the Autumn Statement.
Simon Crone, Genworth vice president at Mortgage Insurance Europe, said: “For many aspiring first-time buyers, raising the average deposit of 16 per cent is simply not an option – especially in places like London where this amounts to vast sums of money.”
Despite the abundance of products available with a 5% deposit, the amount of lending is in decline. There was £1.61bn lent through 5-10% deposit loans in Q3 2015, down by 27% from Q3 2014. However many will welcome the new products and initiatives to help prospective buyers get on the property ladder.
Article By: Bradley George, Senior Mortgage Consultant at Contractor Mortgages Made Easy
Media Contact: Ratchelle Deary, Public Relations Manager
Tel: 01489 555 080