Can I Get a Mortgage With a 5% Deposit in Nottingham?

Gathering enough funds for a deposit can often be one of the most difficult parts of homeownership, especially for first time buyers in Nottingham.

Over the past two decades, house prices have increased steadily, making it increasingly challenging to amass the required deposit for a mortgage. So, the question arises, how much do you need for a mortgage deposit, and can the deposit be as little as 5% in Nottingham?

Can you get a mortgage with a 5% deposit in Nottingham?

If you have good credit, most mortgage lenders will ask for a deposit that is at least 5% of the property’s value.

Therefore, if you are aiming to buy a property worth £200,000, you must prepare to put down at least a £10,000 deposit.

As a mortgage broker in Nottingham, we assess your income and financial capability to determine whether you can get a mortgage with a 5% deposit or if you need to put your homeownership journey on hold to save a little more.

Can you get a mortgage with a 5% deposit with bad credit in Nottingham?

Although getting a mortgage with a 5% deposit when having bad credit in Nottingham might be challenging, it’s not impossible.

However, it mainly depends on the severity and how long you have had credit issues. Typically, applicants with bad credit are required to put down a larger deposit, usually around 10% to 15% of the property’s price.

Is there anything else to help me buy a property in Nottingham?

There maybe several schemes that have been crafted to help first time buyers and home movers in Nottingham up the property ladder. Popular scheme choices for homebuyers include:

Mortgage Guarantee Scheme

This programme aids first time buyers in Nottingham in obtaining a 95% mortgage, i.e., with a 5% deposit. Your financial situation and credit history can influence the effectiveness of this scheme in enhancing your chances of a successful mortgage application.

Shared Ownership Scheme

This scheme presents an economical and viable route to home ownership, allowing you to partly own and partly rent a property. Participants can buy a portion of the property, usually between 25% and 75%, while paying rent on the remaining part. Eventually, participants can increase their share gradually leading to complete ownership.

Lifetime ISA

Although not an actual scheme, this incentive helps first time buyers in saving for their mortgage deposit. It cannot be utilised for those looking to buy their second home.

The lifetime ISA is a tax-free savings account that can be used to buy your first property. The government gives a 25% bonus (up to £1,000) on contributions up to £4,000 per year. For example, if you manage to save a maximum of £4,000 in a year, your ISA will be topped up by £1,000.

Visit OwnYourHome

For a complete list of government-led mortgage schemes, you can visit the OwnYourHome.gov.uk website.

Alternatively, you can contact our mortgage advisors in Nottingham to explore your mortgage options. You might find that based on your financial ability, a 5% deposit mortgage could be well within your grasp, even without the use of a scheme.

If you are a first time buyer in Nottingham, book your free mortgage consultation today and start your homeownership journey today.

Date Last Edited: February 19, 2024