Mortgage with no deposit launched in bid to help 'trapped' renters onto property ladder
09.05.2023 - 09:59
/ manchestereveningnews.co.uk
A deposit-free mortgage aimed at helping renters get onto the property ladder has been launched.
Skipton Building Society said its "industry first" mortgage would help people get out of "trapped rental cycles". As well as no deposit, The Track Record Mortgage will not require a guarantor either.
Instead, tenants who can show they can afford the mortgage and a track record of paying rent can borrow up to 100pc of the value of a property on the five-year fixed rate mortgage. Skipton has warned it expects high demand and the deal "may sell out quickly", Wales Online reports.
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It said there were 4.6million households renting privately across England - more than double the number recorded in 2000. The building society said its own research showed how eight in ten tenants felt "trapped" in the rental cycle, paying rents that are higher than a mortgage which then prevents them saving a deposit to buy their own home.
At the same time, house prices for first time buyers have risen by an average of 18pc in the past two years, an increase of £39,680, it said.
Skipton said its new mortgage would "enable people trapped in these rental cycles who are prevented from saving for a house deposit, to access the property ladder and make a home their own". It added that, to ensure affordability, buyers would not be paying more on a monthly basis than what their current rent is.
Charlotte Harrison, CEO of home financing at Skipton, said: “We need to tackle the UK’s housing affordability crisis to enable more people, especially renters who are trapped in renting cycles, to buy their first home. People trapped in renting is one of the UK’s biggest