27 Dec 2024

Take your pick on a mortgage, if you have a 40% deposit

The number of new mortgages requiring a minimum of 40 per cent deposit has increased by 61 per cent in the last six months.

The number of mortgages requiring a 10 per cent deposit has decreased by two thirds in the last six months.

Darren Cook, Analyst at Moneyfacts.co.uk, commented:

“Banks are far from predicting the end of the housing slump and are hedging their bets by increasing the number of their best mortgages to those who are fortunate to have a 40 per cent deposit.

“The average mortgage rate for a 60 per cent loan to value mortgage is currently 4.29 per cent, compared to 5.92 per cent six months ago and the availability within this tier has increased from 184 products to 297 today. If you have only a 10 per cent deposit, you will be paying an average rate of 5.98 per cent and a choice of only 71 products.

“The spread in pricing between the haves and the have-nots has doubled during the past six months as the fear of negative equity and the inability to pay continues to grow. Since November last year, a mortgage with a 40 per cent deposit is 1.63 per cent down, but a 10 per cent deposit has only become 0.74 per cent cheaper.

“With the Bank of England base rate unlikely to fall bellow its current level and expectations are that we should see this rate unchanged for the remainder of 2009, we will only see better mortgage rates across the board if banks regain their appetite for responsible lending and healthy competition for new business returns to the market”.

Availability of 60 and 90 per cent loan to values
	May '09		November '08
	Number of products	Average mortgage rate	Number of products	Average mortgage rate
Max 60% LTV	297	4.29%	184	5.92%
Max 90% LTV	71	5.98%	204	6.72%
Source: Moneyfacts.co.uk 6.5.09

Moneyfacts Group
Moneyfacts is the UK’s leading independent provider of personal financial information and our data is used and trusted throughout the financial industry.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Think carefully before securing other debts against your home, your home may be repossessed if you do not keep up repayments on your mortgage.

Go Direct.co.uk is a trading style for website purposes of Go Direct UK Ltd.

Go Financial Services is a trading style of Go Direct UK Ltd which is an appointed representative of Personal Touch Financial Services Ltd which is authorised and regulated by the Financial Conduct Authority. Registered in England & Wales Company 5703224. FCA Number 456600

We normally do not charge a fee for mortgage advice, however this is dependent on your circumstances. Our typical fee would be £349