PropLinq

With the Announcement of 5% Deposit Mortgages making a comeback, we have all been eagerly waiting for additional details surrounding eligibility criteria and how long the scheme will be open for. We have obtained these details directly from gov.uk which outline these areas.

What we already know;
✅The Scheme will be open to First time buyers and Non-First time buyers
✅The purchase price of the property cannot exceed £600,000
✅The scheme is NOT restricted to new build properties
✅The deposit required will be 5%
✅Lloyds, Barclays, Natwest , Santander & HSBC are set to offer these mortgages from next month.
✅Virgin money is expected to offer this mortgage “shortly after”, (this is very vague so we will keep you posted as to when they officially come on board)

Ofcourse the scheme looks attractive at first glance but please be aware that you will still have to meet affordability requirements as set by the lenders.

Alas, this is still a silver lining for first time buyers in the UK. The government are taking valuable action to at least try to aid FTB’s on their journey to becoming homeowners.

Will you be taking advantage of this scheme before the deadline? Comment below 👇🏽

To view the full details of the scheme, the document can be downloaded fromhttps://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/965665/210301_Budget_Supplementary_Doc_-_mortgage_guarantee_scheme.pdf

Some types of homes are classed as “unmortgageable”, this is because the majority of lenders in the market are likely to decline lending on them.

At PropLinq, we have listed the main ones that can cause homebuyers major problems. This is not an exhaustive list but a lot is covered in this post. All lenders have policies that may blacklist certain types of construction for example. This often makes it difficult to find a lender that can aid you in your purchase.

Lenders will typically send out one of their surveyors to assess the property for any issues that could be affecting the property. If you are in the process a viewing a home and it falls into one of the categories above then it is worth running this past your mortgage broker and lender BEFORE spending a load of money on getting a surveyor to take a look.

It is worth noting, that even if you do secure a mortgage on any of these types of properties. If you wish to resell, your future buyer is likely to have issues raising a mortgage for your property. So it is worth considering the potential resale market before you purchase any property.

Overall, if you are purchasing a property of this type you must consider what lender attitudes may be in the future. If they have tightened their policies by the time you want to sell up, your buyers will be cash buyers who will be expecting a large discount as they are aware that your resale market is limited.

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