April Mortgages has unveiled a new 100% loan-to-value mortgage designed to help buyers without a deposit and unable to rely on financial help from family.
Good news for those who want to buy a property without a deposit. April Mortgages has just launched a new 100% loan-to-value mortgage aimed at borrowers who don’t have a lump sum deposit saved. The lender has said it will lend up to 100% of a property’s value at 4.49 times income, on a fixed-term deal of 10 or 15 years.
Applicants must have a minimum income of £24,000, and two people can be on the mortgage. Interest rates on this new product reportedly start at 5.99%. As borrowers reduce their loan-to-value ratio with regular mortgage payments, they will be eligible for automatic rate cuts over time. The product excludes the purchase of flats and has a maximum property purchase price of £600,000.
There are no early repayment charges for borrowers who want to repay the loan. They can make uncapped overpayments to reduce their mortgage debt sooner.
Housing market changes
April Mortgages acknowledges that buying a property can be extremely difficult for anyone without financial help from family. It has launched this product in response to changes in the housing market and to help the increasing number of renters who are mortgage-ready but deposit-free.
‘Housing affordability has reached a crisis point in the UK,’ says Rachael Hunnisett, director of April Mortgages. ‘It’s prospective buyers who are paying the price. The first rung of the property ladder is out of reach for people struggling to save for a deposit and those with no Bank of Mum and Dad to fall back on.’
While mortgage rates have gone down in the past year, they are still higher than the historic lows seen four years ago. The 100% mortgage loan will help borrowers with a strong credit history. Applicants will be subject to the usual affordability and credit checks.
Monica Bradley, Founder and Managing Director of MB Associates, says: ‘This is a welcome option for those who can afford monthly mortgage payments but don’t have money saved for a deposit.’
If you would like to know more, we’re here to help.