No Deposit Mortgages
Also referred to as 100% mortgages, these types of mortgages cater for people who don't have a deposit to put down and therefore need 100% lending.
There are many lenders that offer 100% mortgages including most of the high street banks such as Abbey and Bank of Scotland.
Advantage...
The advantage is that 100% mortgages allow people to get on the property ladder who would otherwise have had to wait until they saved up a big enough deposit (at least 5% deposit).
Disadvantage...
The drawback is that you'll pay a higher rate of interest because lenders consider you a higher risk to lend to than if you were putting down a deposit. Typically expect to pay around 0.5% to 1% higher when getting a 100% mortgage compared to if you were putting down a deposit.
How much can I borrow...
Fill in the maximum borrowing calculator on the left to work out the maximum you'll be able to borrow. As a general rule of thumb, you can borrow up to 5 times your income, so if your annual salary is £25,000 then you'll be able to borrow around £125,000.
If you have existing credit commitments such as a personal loan, or car finance, or ongoing credit card balance then the amount you'll be able to borrow will be lower as lenders take your existing commitments into consideration.
What do I need to fulfil...
100% mortgages require that you have excellent credit, but if you have some credit problems then you can still get 100% lending but be prepared for a higher rate of interest, and you'll only be allowed to have a small amount of credit problems, such as a CCJ for £200 registered over 3 years ago. Anything more serious will mean you won't be able to get 100% lending and will need to put down a deposit.
You can apply for a 100% mortgage whether you're a first time buyer or existing mortgage holder moving home. You cannot remortgage to a 100% mortgage from your existing mortgage however, as these products were designed more for buying rather than remortgaging.
If you're a first time buyer then refer to the First Time Buyer Mortgages section to explore other options of obtaining 100% lending.
To source a 100% mortgage click here.
If you would prefer some personal advice click here.