100% mortgages

Find information on 100% and other low-deposit mortgages, then compare the whole UK market for a choice of deals.

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Unfortunately, 100% mortgage deals have almost entirely vanished and it doesn't look like they're coming back any time soon.

Low-deposit mortgagesBut you can compare mortgages with low deposits through Gocompare.com, or chat to an adviser to find out how affordable a mortgage might be.

You will be extremely lucky to get a 100% mortgage but, at the time of writing (October 2013), 95% mortgages are set to become more accessible due to government schemes introduced to make it easier for people to get onto and move up the housing ladder.

Aren't houses much cheaper now?

House prices have fallen from their peak before the credit crunch, but lenders have become even more cautious about how much they will lend and who they're happy to lend to.

That means it's still really difficult for first-time buyers to find a mortgage, let alone a 100% deal.

If you want to buy a house, your best bet is to save up a deposit. Remember, the bigger your deposit, the more likely you are to qualify for the best deals.

What if someone helps me?

Some lenders are willing to offer 100% mortgages if a parent, step-parent or grandparent is willing to stand guarantor and secure the loan against their own home.


However, most mortgage providers aren't offering any kind of 100% mortgage, so you wouldn't have much choice and could end up paying a higher rate.

If you can save at least 5% as a deposit, you'll have access to a much wider range of products - take a look on the mortgage comparison page.

Remember, if someone agrees to stand as guarantor for your mortgage, they will be pursued for the money if you find yourself in difficulties.

If you are lucky enough to have a relative willing to give you a hand then maybe they could help you save a deposit.

What if I'm trapped in negative equity?

Perhaps you want a 100% mortgage because you already own a home and it's fallen into negative equity.

Some lenders have been willing to lend more than 100% for existing customers who want to move house and remortgage but are in negative equity. However, most are unwilling to take that kind of risk.

For most buyers, 100% deals are a thing of the past. But you could still secure a mortgage with a small deposit. Ring 0800 073 1959[2] to speak to one of L&C's expert advisers

If you're trapped in your home then you could ask your lender for consent to lease, letting you rent out your property and move on. This would be subject to terms and conditions. 

Where can I get a deposit?

If you're struggling to save a deposit but you're confident you could afford mortgage payments, it can be really frustrating.

Perhaps you're lucky enough to have family who could lend you the funds, or maybe you could buy with a friend so you only need to save a smaller amount.

Another option is the UK government's Help to Buy scheme, or one of the shared equity initiatives offered by governments in Wales, Scotland and Northern Ireland.

The first phase of Help to Buy, the equity loans element, was introduced in April 2013 for newly built properties in England.

Buyers can access an interest-free loan of 20% of a new-build home's value on top of the 5% deposit they have already saved.

Under the second phase of Help to Buy, introduced in October 2013, the government will guarantee a percentage of a buyer's mortgage, so long as they have saved a 5% deposit and fulfil certain other criteria. This applies not just to homes in England but to properties across the UK. Phase two will end in 2016 as originally planned.

And the mortgage guarantee extends to all properties, not solely new builds, in a bid to benefit the wider property market instead of just homebuilders.
Find out more with our Help to Buy guide then check out our page on first-time buyers for more information.

Fixed or variable rate?

If you've decided to apply for a low-deposit mortgage, you'll need to decide whether to fix your rate for between two and five years, or to apply for a variable-rate mortgage.

Fixing gives you the security of knowing exactly how much your payments will cost each month, which can make it easier to budget for.

However, a variable rate may be cheaper for the time being - remember this could increase or decrease in the future.

Talk to an expert adviser about the options so that you can make the right decision for your circumstances.

You can speak to an L&C adviser for free advice by calling 0800 073 1959[2]

By Felicity Hannah