Halifax is the latest lender to announce it is returning to the 10% deposit mortgage market after previously pulling its low deposit rates when the coronavirus crisis hit in March.
Halifax's new two-year fix undercuts many of the other lenders offering 10% deposit rates. Its two-year fix is 3.54%, and the five-year fix is 3.59%. Both products have £999 arrangement fees, and the maximum loan size is higher than many other providers at £500,000. Early repayment charges apply throughout the fixed period.
The new products are only available to first-time buyers, and mortgages must be taken on a repayment basis. New build properties will not be accepted, and there will be an enhanced credit score requirement so borrowers will need a clear credit history to qualify.
There is a maximum 4.49x loan to income cap applied as part of the bank's affordability assessment, and any financial commitments will be deducted as ongoing in the affordability calculation even when declared as ‘to be repaid’.
Aaron Strutt, product director at Trinity Financial, says: "Over the last week more of the lenders have started providing 10% deposit mortgages again, but the cheapest deals are well over 3%.
"Virgin Money has been offering low deposit mortgages to borrowers willing to take seven or ten-year fixes, although the bank is about to launch a five-year fix."
If you are looking to take a low deposit mortgage, it is worth taking a short term fix, especially if you are taking a larger loan."
Call Trinity Financial on 020 7016 0790 to secure a 10% deposit mortgage or book a consultation