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Loan sizes of \u00a3125,000-1m are available on terms of up to 35 years.\u00a0<\/p>\n
The product has early repayment charges (ERCs) of 5% in the first year, incrementally falling to 1% in the last year of the initial term. Gable Mortgages will allow up to 10% overpayments each year.\u00a0<\/p>\n
Borrowers must be at least 23 years old and no older than 75 years at the end of the mortgage term.\u00a0<\/p>\n
A \u2018crucial\u2019 option for first-time buyers\u2026 with risks<\/p>\n
Nick Mendes, mortgage technical manager at John Charcol, said the product was a \u201ccrucial addition\u201d to the options for first-time buyers, and closely following the 100% LTV mortgage launch from April Mortgages last week<\/a>, showed that \u201clenders are starting to respond to the challenges faced by aspiring homeowners who are mortgage-ready in every way except for the deposit\u201d.\u00a0<\/p>\n Mendes said the \u201cchronic shortage\u201d of new homes was a fundamental issue in the UK housing market, which was unlikely to be resolved in the short term, so products like this offered an opportunity.\u00a0<\/p>\n He added: \u201cZero-deposit mortgages can play an important role for renters who have strong, stable incomes and good credit histories, but have been unable to save due to the high cost of living. The fact that Gable\u2019s deal is linked specifically to new-build homes also supports Government efforts to encourage take-up in that sector and stimulate supply.\u201d\u00a0<\/p>\n He said the five-year fix was a \u201ckey strength\u201d as it offered certainty to borrowers.\u00a0<\/p>\n However, Mendes said there were \u201cimportant considerations\u201d, such as being more vulnerable to house price movements and limitations on eligible property types. <\/p>\n Mendes added: \u201cWith both Gable and April now entering this space, there is every chance that other lenders will follow. Increased competition could lead to better pricing, more innovation and a wider range of options for first-time buyers. The demand is clearly there, and as lenders compete more aggressively at the entry level of the market, it is likely we will see more low- or no-deposit offerings appear in the months ahead.\u00a0<\/p>\n \u201cWhile these products will not fix the wider housing crisis, they are a crucial step in opening up access to homeownership for renters who have been locked out for too long.\u201d\u00a0<\/p>\n Joseph Lane, founder and director of Mortgage Lane, said there was \u201cno denying the appeal of a 100% mortgage\u201d, but such products did have \u201csubstantial financial and behavioural risks\u201d.\u00a0<\/p>\n Lane said: \u201cFirst of all, there is the risk that those opting for a 100% mortgage \u2013 particularly those who\u2019ve not needed to make lifestyle changes or sacrifices in order to save for a deposit \u2013 may lack the financial discipline needed that comes with homeownership. Saving up for a 5% to 10% deposit on a home ensures that buyers have a real stake in their purchase, and could possibly treat these newly released products as easy access to wealth or as a mere alternative to renting.<\/p>\n \u201cSecondly, with 100% mortgages, buyers are starting with 0% equity in the property they are purchasing. If there is any kind of dip in the housing market and the home loses value, they may find themselves in negative equity, potentially trapping the homeowner and meaning they could take a financial loss should they need to move or relocate for any personal reasons, such as job relocation, health or family changes.\u201d\u00a0<\/p>\n This article was first published on YourMoney.com<\/a>\u2018s sister site, Mortgage Solutions<\/a>. Read: Gable Mortgages enters market with 100% LTVs<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"Gable Mortgages has launched 100% loan-to-value (LTV) mortgages for first- and next-time buyers. The lender, which was established…\n","protected":false},"author":2,"featured_media":117414,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3091],"tags":[52699,51,16993,52700,52701,2441,52702,16,15],"class_list":{"0":"post-117413","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-100-ltv","9":"tag-business","10":"tag-first-time-buyer","11":"tag-first-time-buyer-ftb","12":"tag-gable-mortgages","13":"tag-markets","14":"tag-new-build-mortgage","15":"tag-uk","16":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114540934935826503","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/117413","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=117413"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/117413\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/117414"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=117413"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=117413"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=117413"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}