Get a loan for the deposit

Firsttimebuyer_4

Hi,

My other half and I will be trying to get on the property ladder soon. The problem is, as for most first time buyers, we cannot afford the deposit!!

We have 3 options:

1) Get a 100% mortgage at a higher interest rate
2) Get a loan for the deposit
3) Continue to rent...not really ideal

We are thinking that the bank who gives us a mortgage will also lend us the money for the deposit. Is this a normal practice for banks? Or would a 100% mortgage be "better".

roswell

will the mortgage be cheaper than your rent ? if you cant afford to save for a deposit how do you propose to afford the loan ?

Firsttimebuyer_4

We can afford the monthly mortgage payments without any major difficulties. It's the deposit we don't have. If we were to save for the deposit it would take a few years and we do want to start a "place of our own"

The mortgage will be slightly more than our rent (not a lot). That depends of course on the rates we get.....!!

herbiesjp

Don't forget that taking out the loan will reduce the mortgage amount a bank/building society would look to lend you - so it could work against you in that respect.

All depends on the figures you are looking at.