Things are looking up for renters looking to make their way on to the property ladder, thanks to the launch of Skipton Building Society’s new 100% loan to value (LTV) mortgage product. So, good news, if you’re a first-time buyer, and up to date on your finances, you could be eligible for Skipton’s 100%, 5-year fixed mortgage which requires no deposit and no guarantor.
The primary goal of the scheme is to support first time buyers who do not have access to a deposit (or a deposit of less than 5%) via their personal savings or family wealth, allowing them to break out of the rentalcycle. Not only is this a welcome innovation for first time buyers, but many brokers are also seeing the positives. Contrary to the outcome of similar schemes that were introduced ahead of the 2008 financial crisis, UK regulator shave now adjusted the safeguards on mortgage affordability, and criteria for the 100% mortgage will be far tighter than previous iterations of theno-deposit scheme.
Alongside discussions between mortgage professionals on the impact this will have on the sector, some are now wondering, “is this the death of mortgage deposits?” In short, probably not. While the scheme will be revolutionary for many first-time buyers looking to get onto the housing market, it is likely to encourage people to buy smaller, more affordable homes.For anyone looking to purchase a larger property, or a property in a more expensive area, a standard mortgage may be more appropriate.
All innovation in the mortgage space is welcome, and it is great to see so the wealth of positive feedback that this scheme has received. With more first-time buyers on the scene, it is crucial that they fully understand the mortgage process, are offered quality, professional advice, and a seamless,stress-free end-to-end house buying journey – all of which can be achieved through integration of mortgage technology tools.Smartr365’s Mortgage Broker software enables quick and effective advice through In-Built Sourcing and video calling features, offers the possibility of a Decision in Principle in just one click, and speeds up ID-checking processes to get applications over the line seamlessly.
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