100 per cent Mortgages

Paul Demarco from ESPC Mortgages has advice on whether it is possible to find a 100% mortgage.

Piggybank and House

One of the challenges for first time buyers is saving up for a deposit for their first home. But there are now a number of mortgage lenders offering 100% loan-to-value products to first time buyers that do not have the funds to lay down a deposit.

Since the risk for banks is higher on a 100% mortgage, they are subject to more stringent lending criteria than other mortgages and some lenders require that a guarantor - usually a parent or grandparent - will agree to cover the repayments in the event that the borrower cannot meet the monthly costs.  100% mortgages are considered to be of a high risk nature and should not be entered into without due consideration.

There is one 100% scheme in particular from a lender where the customer can acquire a helper to input 10% of the purchase price into a savings account. This helper could be a parent, a relative, a friend or a partner. The lender will then hold a charge over this savings account and the helper would receive the savings back after three years with interest, assuming the mortgage account is paid up to date.

It would be ideal for parents who would like to help with a deposit but want the guarantee of their deposit being returned, and it would also be available to first and second time buyers.

We at ESPC can help you with any questions you may have. We are independent and deal with the whole of the market, and have the knowledge and expertise to analyse and advise you. Come in and see me at your convenience as I will be glad to help.

The information contained in this article is provided in good faith. Whilst every care has been taken in the preparation of the information, no responsibility is accepted for any errors which, despite our precautions, it may contain.

No Individual advice is given, nor intended to be given, in this article and no liability will be accepted in respect of any action you make take as a result of reading this article.  If you are unsure whether any particular course of action may be suitable for you, you are urged to take independent advice.

The initial consultation with an adviser is free and without obligation. Thereafter, ESPC Mortgages charges for mortgage advice are usually £350 (£250 for first-time buyers). YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR OTHER LOANS SECURED AGAINST IT.

For more information on how ESPC Mortgages can help you, click here.