img
img
MyMoneyHelp home
Sign up for our newsletter!
Name:
Email:

corner cor cor
cor
MyMoneyHelp
Credit Reports
Personal Loans
Mortgages
Insurance
Debt Help
Credit Cards
Banking
Education Center
cor
cor cor co
corner cor cor
cor
Education Center
Banking
Credit Cards
Credit Reports
Debt Help
Insurance
Mortgages
Personal Loans
Glossary
cor
cor cor co
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100% mortgage
What are 100% Mortgages?

A 100% mortgage is a home loan that is given to buyers who need to borrow 100% of the cost of the property they are intending to purchase. A 100% mortgage effectively means that no deposit is required; you will therefore not have to hunt around looking to raise funds to make up a deposit. A 100% mortgage means your lender will loan you the full amount. This type of loan is also called a 100% home loan.

100% home loans or mortgages are perfect for:

  • Young first time buyers who are trying to enter the housing market.

  • Any borrower who is struggling to find the deposit necessary to buy a home for themselves

  • Any borrower who would rather not have to spend time saving up for a deposit.

What types of 100% mortgages are on offer?

There are different varieties of 100% home loans available, so it is important to compare 100% mortgages that are being offered to you, especially if you are first time buyers.

The type of 100% home loans on offer will vary from lender to lender. Depending on your lender, it is possible to take up any type of standard mortgages including fixed rate, interest-only, discounted, and tracker rates. It is always a good idea to shop around, compare 100% mortgages, and then decide which variety best suits your needs.

The amount you can borrow on a 100% home loan will entirely be governed by the decisions of the lender you choose. As a general rule, the majority of lenders providing 100% mortgages will allow you to borrow an amount approximately three times your annual salary if you are the sole applicant or two and a half times your joint salaries if you apply as a couple.

As mentioned above, no deposits are necessary on 100% mortgages; this is exactly the point of such a mortgage, making it particularly attractive to first-time buyers.

What are the benefits of 100% mortgages?

The most significant advantage to a 100% mortgage lies in the fact that you do not need to raise a deposit to be able to buy the property of your choice. Most homebuyers, especially young first time buyers, make a huge effort to save for the standard required deposit which is normally around 5% of the property’s value.

When you have just started working and earning money, it can take years to save up. However, a 100% home loan conveniently removes this period of waiting and saving. As soon as you want to, you can buy your dream home! With house prices at an all-time high, many first time buyers feel justified in taking out 100% mortgages as they feel the urgent need to get onto the property ladder as soon as possible.

Important considerations for 100% mortgages

It is vital to compare 100% mortgage varieties, so that you end up with a product with which you are satisfied.

One of the most precarious aspects of taking out a 100% mortgage is that as soon as the housing market takes a dip, you are effectively and instantly in negative equity. This may not happen, but it can be a frightening experience especially for first-time buyers.

It may be worth looking around for lenders who are eager to secure your business by offering you special 100% mortgage promotions and deals. These may include attractive discounts and special offer rates, but some deals go further and can give you other more concrete benefits. For instance, some of the money-saving bonuses offered by certain lenders include:

  • an agreement to cover or contribute to the cost of your legal fees.

  • an agreement to waive their standard arrangement fee.

However, watch out for some lenders who may charge you an additional fee before you are able to take out this type of 100% mortgage. Again, specifically if you are a first time buyer, make the effort to compare 100% mortgages by reading the small print before you come to a decision!

The downside of 100% mortgages or 100% home loans is that you will have to endure a high interest rate. This is the way lenders make their profit in allowing you to not have to put down a deposit. Again, if you research the deals available and compare 100% mortgage interest rates on offer, you will have the best chance of securing one with the most favourable rate.

Lastly, be certain that you can afford to make your monthly 100% mortgage repayments as you are likely to be paying more than other borrowers with standard mortgage deals.

Check out the best mortgage providers

 
 
 
 
 
 
 
banner

 
 
© MyMoneyHelp.com. All Rights Reserved.    Sitemap | Newsletter | About | Contact | Terms of Use | Privacy | Online Coupon Codes

Valid XHTML 1.0 Transitional

img