100% Mortgages

A new Track Record mortgage without the need for a deposit has been launched.

This is designed for clients who have a track record in paying rent and household bills but whilst they have been doing that, have struggled to save a deposit to put down on a house of their own.

Who is eligible?

You might be eligible for this product if:

• Each applicant is a first time buyer
• Each applicant is aged 21 or over
• Each applicant has no missed payments on debts/credit commitments (e.g. mobile phone bill) in the last 6 months
• You are looking to borrow up to £600,000
• You are not looking to buy a new build flat
• You have proof of having paid rent for at least 12 months in a row, within the last 18 months
• You have 12 months of experience paying all household bills within the last 18 months.
• You meet the household-to-household criteria (see below)

The amount of borrowing available will depend on your rental payments and an assessment of your income and outgoings (affordability) you will also need to pass credit scoring and meet the lenders criteria.

What does household-to-household mean?

Household-to-household means that the same people who are renting now (and have been for the last 12 months) are the same people applying for the mortgage.

If applying alone, the rental and household expenditure payments must have been covered entirely by your client for 12 consecutive months within the last 18 months.

Joint applicants who have been renting separate properties will be eligible, as long as each applicant can evidence that they have individually covered their entire rental and household expenditure payments. In this instance, when calculating the max loan amount based on the average rental payment over the last 6 months, their combined rental payments can be used.

Can you apply with a small deposit too?

Yes you can! Although you don’t have to put a deposit down here, you can still contribute up to a 5% deposit in order to reduce the amount you need to borrow.

It is great to see a lender who has spotted this gap for renters and with the cost of living crisis meaning we have less money each month to save, saving a 5% or 10% deposit is out of reach for many, however that doesn’t mean they couldn’t necessarily afford the mortgage payment and to run the house itself.

This product has received some scepticism, with some fearing it could be creating a problem by going back to 100% lending, however this is not a product for everyone or all first time buyers like they have been in the past. This is specifically designed for the people who are already successfully running a household, paying rent each month on time and in full but are simply struggling to save their deposit whilst doing all that. It is a cautious but welcome approach and a very modern approach to mortgage lending that will hopefully have others following suit!

If you would like to know more about a Track Record Mortgage or any other type of mortgage speak to one of our advisors today.

Please note:
Your home may be repossessed if you do not keep up repayments on your mortgage.

100% mortgages are more expensive and come with a greater risk of negative equity. This is where the value of your mortgage becomes more than the value of your property – something that might happen if property prices were to drop significantly.

You can only borrow the equivalent of, or less than, what you pay on rent each month.

Terms & conditions apply.