Nationwide Building Society has announced it will be returning to the 10% deposit market from Monday 20 July but limiting the mortgages to first-time buyers purchasing houses and not flats.
The lender will have a selection of two, three and five-year rates, but for the moment only for first-time buyers purchasing houses or bungalows that are at least two-years-old will qualify for a 10% deposit rate. Applicants will need a 15% deposit to buy a flat through Nationwide.
Aaron Strutt, product director at Trinity Financial, says: "It is unusual for a lender to make its low deposit mortgages available to houses and not flats, but this is a sign of the times.
"The bigger banks and building societies have been under pressure to return to the low deposit market, and there are more 10% deposit mortgage available to buy flats and houses."
Nationwide has confirmed it will not provide 10% deposit mortgages to applicants on furlough schemes and it is not accepting fully gifted deposits. The maximum term has also been capped at 25 years and the maximum loan is £500,000.
There will be first-time buyers applying to Nationwide who will find it hard to understand why lending is limited to houses, but the lenders are worried about house prices coming down.
Call Trinity Financial on 020 7016 0790 to secure a mortgage
- All applicants must be first-time buyers who have not held a mortgage in the last three years. This includes UK and Non-UK mortgages.
- No bonus, commission and overtime will be considered for affordability calculations unless the applicant is a key worker.
- Income from a new job or a pay rise can still be used if it is commencing within three months.