Any mortgages out there with 5% deposit?

dannyboyslim

Hi all,

The OH and me want to move this year, early part if possible. We're now putting the apartment we are in on the market and are looking to upgrade to a house. We're looking to be in the new place for a good few years - we don't view property as an investment, we just want a home.

I've got 103,000 left on the mortgage and it's unlikely the price we'll successively sell for will be near this, so we are already in the mindset that we'll have to take a hit. We're ok with this as we really would like to move now. We'll have about 28k between the two of us by April, and we're looking in the region of 180k-200k for a property. With selling the property, we've budgetted around 23k including all the fees etc.. based on a 180k house and needing 10% (18k) as a deposit.

Anyhow, long story short, the sticky wicket is going to be how much we can get for the apartment. One option if we really get stuck with a low offer (or have to drop the price to get a sale) would be if there are any mortgage providers out there who only require 5% deposit?

I know the rates might be a bit scary, but we are in an odd position where the mortgage on 180k is very affordable to us, it's just the initial start up cost when considering how much we might lose on the sell. Anyone know of any providers who still do 5% deposit, just in case we need it?

Thanks

beecher

The other option is offering less for the property you go for. Hopefully houses which are on sale for £180-200k will be able to be bought for a lot less. With house prices going down the jump between your house and the one you want shouldn't be as big as it was at the peak.

dannyboyslim

It's a very real option, but the potential pitfall we're facing is that the mortgage over the long term isn't the issue, it's the money possibly needed to make up any shortfall from selling our property.
That has to be addressed in the short term.
A smaller mortgage only helps us over the 25 years as a whole (with a slightly smaller monthly payment in the early years).
Gone are the days of being able to borrow more to cover such costs (and rightly so IMHO) - but a bank offering a mortgage based on only a 5% deposit would be a real option for us, even if you were talking about a 7%ish rate of interest. Of course, this could all be mute if A) We get an ok offer that we can afford the hit on, or Any offers are so low as to be completely not do-able.
A 5% deal would just give us more options.
I see today the Daily Fail is talking about Banks being B******ED because they aren't loosening their purse strings and apparently this could stifle some "green shoots" which are emerging in the property market... according to the DM anyway!

fj101

the only news i have is bad news! I am in a similar position to you .. i.e.can afford re-payments but cant get the mortgage.
I had been keeping an eye on all 5% deposit mortgages but in recent weeks/months as far as i can see they have all stopped, asking for a minimum of 15% instead (Nationwide for example).
keep looking.. you might find one somewhere. Good luck