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First Time Buyers, How A 95% Mortgage Could Help You


First Time Buyers, How A 95% Mortgage Could Help You


First-time buyers with small deposits may now find it easier to get a mortgage, with 90% and 95% deals becoming easier to access. The government recently announced a return of the 95% mortgage in order to help turn ‘generation rent’ into ‘generation buy’. But how will this help you?...

Nine in ten 90% and 95% mortgages were withdrawn from the market in the wake of the Covid-19 outbreak last spring, says Which.  

A year later, things are starting to look better for first time buyers, with mortgage lenders bringing back 90%, and a selection re-introducing the 95% mortgage guarantee scheme.


What is the 95% mortgage guarantee scheme, and how can it help?

95% mortgages, allow you to enter the market with only a 5% mortgage, making it easier for first time buyers with small deposits. 

The scheme has been encouraged by governments to turn “generation rent, into generation buy”, and as a result the scheme involves the government taking on some of the financial risk e.g. If a buyer was to default on repayments. 

The guarantee has so far been successful, with 78 fixed rate 95%* deals now available to the market, at the start of March there were only five. 


How much can I borrow with a low-deposit mortgage? 

It is important to look at how much you can borrow, not only so you can enter the market with a price point in mind, but so you don’t look at properties and fall in love with those beyond your means. 

When taking a 90 or 95% mortgage you can usually* borrow up to four and a half time your income (or joint income). Although, there are exceptions with some lenders. 


All in all, we can see that the market is getting better for first time buyers and this is an exciting time to start getting your foot on the ladder. If you want to take advantage of the schemes pop us a call today! 

Still a little confused?  Call your local branch and we can help you find a mortgage advisor!

Helpful Information For First Time Buyers



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