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New mortgage to help those stuck on the first rung of housing ladder with a deposit of only 5%

19th January 2016


Clydesdale and Yorkshire Banks have launched a new targeting homeowners who are having difficulties taking the next step up the property ladder.

The Home Mover Mortgage allows borrowing between 90% and 95% loan-to-value, meaning that applicants would only need to have built up equity of between 5% and 10% in their existing property in order to qualify.

It comes with a three year fixed rate of 4.49%, no arrangement fee and a free standard valuation.

Research by the banks, which are part of the same group, found that many people are still struggling to move up from their first property, despite improvements in wage growth, stamp duty reforms and continued low mortgage interest rates.

The findings reveal that 37% of first time buyers are staying in their first property for longer than planned and this is most acute in London where 49% of those surveyed had not bought a second property within the timescale they had initially intended.

This is in contrast to the East of England where only 23% of first time homeowners had stayed in their property longer than planned.

The research revealed that first time buyers plan to stay in their first home for an average of seven years and nine months although a quarter plan to stay for more than 10 years.

Those in the North East plan to stay in their first property for the longest amount of time – almost 11 years – while first time buyers in London have hopes of moving up the property ladder after six years and three months.

Steve Fletcher, director of retail banking at Clydesdale and Yorkshire, says: “The step between the first and second property remains a challenge for some and increasing moving costs are also adding to the difficulty of raising a sufficient deposit to afford a larger home.

“Our new 95% LTV mortgage is designed to support those who can afford larger mortgage payments but are struggling to save the required deposit.”

Aaron Strutt of Trinity Financial, the broker, says: “Clydesdale/Yorkshire are looking to help buyers struggling to buy another home and there is certainly space in this market and enough demand.

“Thankfully lots of the lenders provide 5% deposit mortgages to first time buyers and next time buyers. For example, Nationwide, Chelsea and Santander all cater for borrowers planning to move home with a low deposit.”

1 thought on “New mortgage to help those stuck on the first rung of housing ladder with a deposit of only 5%”

  1. Jive Bunny says:

    “Clydesdale and Yorkshire Banks have launched a new targeting” sorry? A new….what??? targeting home owners??????

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