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‘Generation Buy’: What are 95% mortgages?

During last week’s budget, Chancellor Rishi Sunak announced the government will be introducing 95% mortgages from next month. The move will allow first time buyers and home movers to purchase a property with a 5% deposit.

Last year Boris Johnson pledged to ‘turn generation rent into generation buy’. The new scheme will enable mortgage lenders to loan up to 95% of the value of a property. Coupled with the Stamp Duty holiday, the 95% mortgages will make moving house even more affordable for buyers and sellers across the UK.

The 95% mortgages will be available from April 2021 until 31st December 2022 and will be limited to homes up to the price of £600,000.

How does a 95% mortgage work?

A mortgage lender will loan the buyer up to 95% of the property value. The buyer will need to save the remaining 5% to put down as a deposit on the home. For example, if the property is £150,000, the mortgage lender will loan up to £142,500, with the buyer putting down £7,500 as a deposit.

Can I still buy a house using a 10% deposit?

Yes! If you can afford to put down a bigger deposit for the property, then you still can. 95% mortgages are another option to help first time buyers and home movers access the property ladder. Mortgage lenders offer a range of mortgage products – speak to The Mortgage Genie for more information and advice.

It’s a great time to move. If you buy or sell a property with us, we’re offering you even more savings with 20% off conveyancing fees* with our sister company Emsleys Solicitors. Contact our team today to book your free professional valuation.

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 Jared Thomas

Written by

Jared Thomas

Director (Sales)

With over 16 years’ experience in estate agency, Jared has expert knowledge of the local area and the property market. He leads a team of highly experienced estate agents and is committed to providing an excellent standard of client care and satisfaction. Jared has extensive experience of all housing markets, both in cities and in villages, and does not believe in a ‘one size fits all’ approach.