Lenders 'expecting bigger mortgage deposits'

Date:Thursday 7th May 2009
Author: Susanna Kavka

UK lenders are expecting bigger deposits to be put down for mortgages, new research shows.

According to Moneyfacts.co.uk, the number of home loans available which require a ten per cent deposit has decreased by two-thirds over the course of the last six months.

The organisation found that people with deposits worth a tenth of the value of their properties will have a choice of 71 products and will pay an average of 5.98 per cent.

In addition, banks and building societies are said to be reserving their best deals for consumers who have significantly larger deposits to put down.

Moneyfacts.co.uk analyst Darren Cook said: "Banks are far from predicting the end of the housing slump and are hedging their bets by increasing the number of their best mortgages to those who are fortunate [enough] to have a 40 per cent deposit."

Recently, the Co-operative Bank launched a new mortgage which allows certain first-time buyers to use a family member's income to guarantee the loan, the Daily Mail reported.