You are here: Home - Mortgages - First Time Buyer - News -

First-time buyer mortgage choice falls post-Brexit

First-time buyers are finding it tougher to get a mortgage following the Brexit vote as numbers of high loan-to-value mortgages dwindle and lenders become increasingly ‘picky’ over applicants’ earnings.

Research from Am Trust Moneyfacts showed the number of 95% LTV products dropped from 249 in June to 238 in August; the only LTV bracket to see a decline in product numbers month-on-month.

Products for borrowers with a 20% deposit have seen their choice of deals increase in the last month. Mortgages in the 80% LTV bracket fell from 623 in June to 597 in July but recovered in August by rising to 607.

Paul Flavin, managing director of Zing Mortgages, said he had noticed a definite drop-off in options for first-time buyers since the Brexit vote but this was not necessarily reducing the number of borrowers able to secure a mortgage.

He said that to secure a mortgage with only a 5% deposit, borrowers already had to be ‘squeaky clean’, which meant that they would meet the credit score of all remaining lenders in the market, but now they had less choice on rates.

Flavin said the reduction in the availability of 95% products had made it slightly more difficult for borrowers with multiple and varied income sources to secure a mortgage, as these options had now become narrower, as remaining lenders became ‘picky’.

In quarter one this year, 95% LTV lending accounted for 2.5% of total mortgage lending down from 3% in the previous quarter and 3.5% year-on-year. High LTV lending rose to 4.2% in Q2 2014 when the Help to Buy: mortgage guarantee was first introduced. The scheme is scheduled to close at the end of the year.

Flavin said first-time buyers being frozen out of high LTV mortgages because lenders’ income criteria was too restrictive are looking to parents to gift an extra 5% deposit to open up the mortgage options available to them.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

ISAs: your back-to-basics guide for 2018/19

Here’s everything you need to know to make the most of your unused ISA allowance ahead of the 5 April deadli...

A guide to Sharia savings accounts

A number of Sharia savings products have upped their game in recent months, beating more familiar competitors ...

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

  • RT @YourMoneyUK: Government plans cut to minimum shared ownership stake
  • RT @WeareJust_PR: “Families tend not to talk about money and death. But if we don’t talk about these themes it becomes very hard to make pr…
  • RT @RoyalLondon: Voluntary NI contributions to state pensions have risen - @stevewebb1 hails this as “great news that the message is gettin…

Read previous post:
Cheaper London bus travel from today

Travelling by bus in the capital will be cheaper from today thanks to the launch of the new 'Hopper' fare.