The housing market is struggling, especially when it comes to bringing in new buyers.  For those homeowners who had sought to downsize or upgrade their current home the lack of buyers has forced many to consider a remortgage to fund a new purchase.  They then turn the other home into a buy to let rental property.  The buy to let market is far out performing the new purchase market.  The inability to gain mortgage approvals or afford a deposit is keeping households from obtaining home ownership.

There now is a renewal of the 100 per cent mortgage scheme that had disappeared from the mortgage lending market when the credit crisis occurred.  Aldermore is now bringing the offer back to first time homebuyers.  The deal involves an interest rate of 6.48 per cent, which is a fixed mortgage for three years.  The home buyers must be over the age of 25 and have a relative willing to guarantee the mortgage with their own home when borrowing above 75 per cent loan to value. 

Charles Haresnape, Aldermore's managing director of residential mortgages remarked on the inability for families to obtain deposits for home purchases, “We believe this is the single biggest issue facing first-time buyers and it needs to be addressed head on if the UK's housing market is to have a chance of recovery.

"Family support in the form of gifted deposits has become commonplace and is widely accepted by most lenders.

“The Family Guarantee Mortgage gives much greater flexibility, enabling guarantors to retain savings and instead provide a guarantee, requiring no cash deposit.”