We all know that buying property is a tricky business, but it seems that of late it’s been even trickier. Thanks to the end of the 100% mortgage, 
the huge differences in average house prices across the country and our wobbly economy, it’s pretty difficult to know what’s going on in the property market a lot of the time. However, mortgage lenders seem to have got their act together and decided to make things a little easier for potential property buyers for a change: introducing the return of the 90% mortgage! Although it’s not as convenient for first-time buyers searching for that perfect house for sale as the 100% mortgage was, the relatively small 10% deposit is much more manageable for most people.
So who’s leading the pack when it comes to 90% mortgages? Well, the Post Office were first to offer the newer type of fixed-rate mortgages, with their 90% mortgage being fixed at 5.49% for two years with a £999 fee to pay on top of that. The Co-op and Britannia were both quick to follow the Post Office with similar 90% fixed rate mortgage deals, but it’s Santander who seem to be ahead of the game: their mortgage is fixed at 5.99% with a fee of just £495.
Nevertheless, those with a bit of financial know-how would probably advise against going with a mortgage deal simply because it means a lower deposit. ‘But why?’ I hear you ask! Well, paying out just five per cent more for your one-off deposit payment could see your long-term interest rates drop considerably, whilst if you could afford a 30% deposit, they could be as low as 2.99%. So, it’s definitely worth weighing up the advantages of a lower deposit now against the disadvantages of having higher interest rates in the long term.
While you’re pondering over this confusing conundrum, why not take a look at our property section?! Our trusted sellers upload great new listings to adflyer every day, so whether you’re after a house or flat for sale, a flat or house for rent or even just a room for rent, you could find a great deal with us.
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June 14th, 2010 at 10:02 am
This is good news. I think at one point people thought that the 90% mortgage was never return and now that it has, some confidence should be instilled within the property market.