Raising a mortgage deposit is often the biggest challenge for many people trying to step onto the property ladder. For many hopeful homebuyers, the monthly repayments are affordable. Saving up for a 10% deposit on a £200,000 home, however, means finding £20,000 upfront while you’re handling other living costs.
The good news is, from 18th May, Halifax are introducing a new mortgage product designed to change that. The new mortgage package allows eligible first-time buyers to purchase a home with a minimum personal deposit of £5,000.
At Mackenzie Smith, we work with first-time buyers every week, so we believe that this is a product worth paying attention to. So, what’s included?
Key Features of the New Halifax Mortgage:
• A minimum personal deposit of £5,000 • A maximum purchase price of £300,000 • A five-year, fixed-rate mortgage • A £0 product fee option available, above 95% to 98.34% Loan to Value (LTV) • A free property valuation included
The mortgage is available to eligible employed and self-employed applicants, with only one person on a joint application needing to be a first-time buyer.
Importantly, the deposit must come from the buyer’s own savings, so it cannot be gifted by family and proof of this may be required. Also, the mortgage deal does not cover purchases of brand-new homes.
What This Could Mean for First-Time Buyers
Whilst credit history, lender criteria and affordability all play key roles in attaining a mortgage, products like this do signal a positive change in the market.
Halifax is a leading lender and this means other major lenders may follow suit. More lenders are beginning to enter this space, creating greater competition, more options and potentially better outcomes for buyers who have previously found themselves unable to save for a larger deposit.
In some cases, the deposit is the biggest obstacle preventing buyers from moving forward. Reducing the financial requirement to £5,000 could make home ownership considerably more achievable for some. For first-time buyers who have been waiting for the right opportunity, this may be one worth exploring.
As an estate agent, we know that every buyer’s circumstances are different. We’ll always recommend speaking with a qualified mortgage advisor before committing to a mortgage deal. If you contact your local office, we’ll be happy to refer you to refer you to one of our trusted partners for financial advice.
Stay up to date with the latest property news, expert insights, and valuable tips — sign up for our newsletter to receive information directly to your inbox.
Δ
