95% mortgages

a_m_travis

my girlfriend and I have been offered a really good deal on a new build, but it won't be ready until this time next year. We both have houses; she is only likely to sell hers for what she paid, but mine should make £2-3k (minimum as they are selling quite quickly at the moment), possibly more. I can save a 5% deposit, but 10% would be difficult.

Obviously we are looking to get a 95% mortgage, does anybody know of a lender that is:
1 - willing to lend 95%
2 - willing to agree something so far in advance

Also, is it likely that more/any lenders will start offering 95%?

As we stand at the moment it is only a £500 deposit, so I see it as a stomachable gamble, but any advice would be welcome.

Cheers in advance and apologies for any bad spelling.

opinions4u

As far as I am aware no lender will offer a 95% mortgage.

Yorkshire Bank, Nottingham Building Society and Clydesdale Bank have been rumoured to be offering them, but they are certainly not actively marketing them.

I think there will be a return to 95% mortgages being generally available, but we are some way off that.

You have another problem though. It's a new build. Many lenders are asking for 20% deposits on such properties.

I wouldn't put down a non-refundable deposit and I wouldn't sign any paperwork at all.

a_m_travis

we looked at the same propoerty 6 months ago and it was up for £40k more, so the price reflects the market, why is it that some lenders now want bigger deposits?

AnxiousMum

Look at this way - if six months ago you had bought the place for the additional £40K on a 95% mortgage, and now it is worth £40K less......you'd already be in negative equity and the place hasn't even been built yet! That's the big gamble for you with a 95% mortgage - that you are stuck somewhere that for whatever reason you may want to move from in the future. But will you be able to afford to sell and move? For the banks.....if you lose your job, and lose your home - they will be out of pocket.....

a_m_travis

cheers for the advice, it has made me think.