95% LTV mortgages or 5% deposit mortgages
Due to the operational challenges created by the COVID-19 pandemic, we have temporarily restricted our lending criteria and withdrawn a number of our mortgage products including those for 95% Loan To Value. Visit the FAQs for more information.
Mortgages for people with smaller deposits
We know that everyone’s financial circumstances are different, and of course that means the size of a deposit can vary substantially. There may be those with a repayment mortgage who will have at least half the value of the property available, but there are others who are taking their first step onto the property ladder having saved that first initial 5% deposit for a mortgage.
A 95% LTV (loan to value) mortgage, one that requires a 5% deposit, would typically appeal to a first time buyer who has saved hard for what is generally the minimum deposit required to secure a mortgage. Of course, that doesn’t mean these mortgages are entirely limited to first time buyers. Perhaps those who have owned a home previously, and now wish to get back onto the property ladder, are also working with a more modest deposit.
Things to consider with a 95% LTV mortgage
There are definite pluses to taking out a 5% deposit mortgage. It may mean the difference between being able to buy your first home rather than renting.
These mortgages can vary in cost. For example, it may be possible to take out a 95% LTV mortgage using a £20,000 deposit if the home was worth £400,000. But, if you're taking your first step onto the ladder and planning to purchase a £100,000 flat, then you'll only need to put down a £5,000 deposit.
Your mortgage repayments may be cheaper than your monthly rental payment, although it’s always best to seek an independent financial adviser when making decisions like these. And it’s worth bearing in mind that 95% LTV mortgages will often have higher interest rates than mortgages requiring a larger deposit. However, our skilled, experienced mortgage consultants will discuss this with you as part of the process, and will help explain how interest rates work.
We’re also committed to helping first time buyers in other ways, such as through shared ownership mortgages and our gifted deposit scheme, where we can accept applications where all or part of the deposit is a gift from family members (subject to conditions).
Why should you choose Ipswich Building Society as your mortgage lender?
- We work alongside our borrowers to ensure that each individual is given the mortgage that really suits them. We will get to know you properly before making a recommendation.
- We are an independent mutual mortgage lender. That means that we don't have any shareholders. Every decision we make is done so with our members in mind.
- We have 170 years of experience in the mortgage sector. Whatever your situation might be, we can work with you to achieve the best possible outcome.
- We don't use computers to make our lending decisions - all applications are reviewed by our expert mortgage consultants.
If you’d like to find out whether a 5% deposit mortgage is right for you, then give us a call today on 0330 123 0773.