Cutting Through The Jargon - 100% Mortgages For First-Time Buyers

This week, Skipton Building Society announced their brand-new Track Record Mortgage designed to help prospective first-time buyers take their first step onto the property ladder.

What is a Track Record Mortgage? 

With a Track Record Mortgage, first-time buyers with less than a 5% deposit can borrow 100% of their property price if they can provide proof they have been renting for 12 months in the last 18 months and have successfully paid their rent and bills on time during this period. 

The fixed five-year deal is designed to help first-time buyers over the hurdle of saving for a deposit and secure their first home. With this mortgage deal, buyers will be able to borrow up to 4.49 times their annual income, or an amount based upon the average of their previous six months rent payments, whichever is lower. The maximum amount applicants can borrow on a Track Record Mortgage is £600,000. 

Our director, David Cooper said: “We welcome any innovative new products which will potentially bring more first-time buyers to the market, but we would always recommend that you speak to an independent financial advisor to ensure that it is right for you and your circumstances.”

Who qualifies for a Track Record Mortgage? 

To be eligible for the mortgage deal, all applicants must be: 

• Aged 21 or over 
• First-time buyers 
• Free from missed payments on debts or credit commitments within the last six months. 
• Purchasing a home which is NOT a new build flat. 

Track Record Mortgage vs. Saving for a Deposit 

When applying for a mortgage it is important to consider the type of property you would like to purchase and also how much that is going to cost in your area. As with other traditional mortgage products, with a Track Record Mortgage, you will be limited on what you can purchase by affordability. 

For example, based on Skipton Building Society’s Track Record Mortgage calculator, if you have paid £800 per month in rent over the last six months you may be able to borrow £149,153 for your new home. This will be the maximum amount you would be allowed to borrow, but depending on your current income the final borrowing amount may be less. 

Therefore, it is important to carefully consider whether you can afford a home in your area or if you need to continue saving for a deposit towards a traditional mortgage to buy the property you want. 

If you are a first-time buyer searching for your ideal home, register with Redbrik and let us help you take the first step onto the property ladder: https://www.redbrik.co.uk/buy/