Why we bought our first home with a 100% mortgage - despite the risks
Until last year, Conroy, 32, and his partner Amber, 28, saw little prospect of owning their own home. They were renting in central Manchester where they work and could not afford to save up for a depโฆ
Until last year, Conroy, 32, and his partner Amber, 28, saw little prospect of owning their own home. They were renting in central Manchester where they work and could not afford to save up for a deposit.
Then they came across a relatively niche, and some experts say riskier, type of mortgage that offered a solution.
The Track Record mortgage from Skipton Building Society covers 100% of the value of a property, with the borrower paying nothing upfront.
Borrowers must meet strict eligibility checks and pay a higher interest rate - in Conroy and Amber's case 5.33% fixed for five years - but they were happy to do this. And in August they bought a four-bed home for รยฃ242,000 in Swinton on the edge of Manchester.
"I don't think it's dawned on us it's really ours," says Conroy, a video editor.
According to the Bank of England, the share of UK mortgages with deposits worth less than 10% of the property's value is currently the highest it has been since 2008 , external when such loans were widely available.
The average deposit for first-time buyers is currently around 20%.
It comes as lenders such as Lloyds, Santander, Skipton and Yorkshire Building Society have launched a raft of new mortgage deals over the last few years covering upwards of 95% of the value of a property, and in some cases as much as 100%.
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