What are 100% mortgages?
A 100% mortgage allows you to borrow the full purchase price of a property. In other words, you are borrowing at 100% loan to value, which means there is no cash deposit being put towards the purchase.
These mortgages are usually aimed at buyers who can demonstrate that they can afford the monthly payments, but who have struggled to save a deposit.
Because the lender is taking on more risk, the eligibility criteria are usually tighter than for more standard mortgage products. This means income, credit profile, employment and the overall strength of the application can all be especially important.
By speaking with us we can help you get:
- Clear advice on whether a 100% mortgage may be realistic for you
- Help understanding current no deposit mortgage options
- Support comparing 100% mortgages with other possible routes
- Guidance on lender criteria, affordability and documents
- Appointments by phone, video call or in person
- Advice for clients across the UK
Can you still get a 100% mortgage in the UK?
In some circumstances, yes. There are still some mortgage options available for buyers who do not have a deposit, but availability is more limited than with standard mortgage products and the criteria can be stricter.
A 100% mortgage is a specialist type of borrowing, so not every lender offers it and not every applicant will qualify. The options available can also change over time, depending on lender appetite and market conditions.
If you are exploring whether you can buy without a deposit, it is important to look at the detail carefully rather than assuming a 100% mortgage will automatically be available. In some cases it may be an option. In others, an alternative route may be more suitable.
How do 100% mortgages work?
100% mortgages can work in different ways depending on the lender and the product.
Broadly speaking, these mortgages are designed for buyers who do not have a deposit but can show they are able to manage mortgage payments responsibly. Some products may be aimed at renters with a proven payment history, while others may come with more specific conditions around the mortgage term, applicant type or how the product is structured.
As with any mortgage, the lender will assess whether the borrowing is affordable and whether the case fits their criteria.
Because these are more specialist products, it is important to understand not just whether a 100% mortgage exists, but whether the particular rules behind it fit your circumstances.
A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.
What do lenders look at for a 100% mortgage?
Lenders will usually assess 100% mortgage applications carefully, because there is no deposit as a buffer.
They may look at things such as:
- Your income and affordability
- Your employment status
- Your recent credit history
- Your track record of paying rent or other commitments
- The type of property you want to buy
- Whether the mortgage is restricted to first-time buyers
- Your wider financial commitments and outgoings
Because criteria can be more selective, a 100% mortgage application often needs to be packaged carefully. We can help you understand what lenders may look for and whether your circumstances are likely to fit.
Can you get a 100% mortgage with bad credit?
It may be more difficult.
A 100% mortgage already represents a more specialist type of borrowing, so if you also have bad credit, missed payments or recent credit issues, the options may be more limited.
That does not always mean there is no route forward, but it does mean expectations need to be realistic. In some cases, the best next step may be to improve your credit profile, strengthen your application or consider an alternative to a no deposit mortgage.
If bad credit is part of the picture, we can help you understand whether a 100% mortgage looks realistic now or whether another route may be more suitable.
Alternatives to a 100% mortgage
A 100% mortgage is only one possible route if you do not have a full deposit saved.
Depending on your circumstances, alternatives may include:
- A 95% mortgage with a smaller deposit
- A family assisted mortgage
- A JBSP mortgage
- Support through a gifted deposit
- Waiting and saving a modest deposit to widen the number of lenders available
In some cases, putting down even a small deposit can open up more mortgage choice and better rates. That is why it is helpful to compare all realistic options rather than focusing on one route too early.
Things to consider before applying for a 100% mortgage
A 100% mortgage can help some buyers, but it is important to understand the risks and limitations.
Points worth considering include:
- There may be fewer products available than with standard mortgages
- Criteria can be tighter
- If property prices fall, there is a greater risk of negative equity
- Strong affordability is usually very important
- Another route may offer more flexibility or a wider choice of lenders
A 100% mortgage can be the right option in some circumstances, but it is important to look at the full picture before moving ahead.
Why speak to Your Mortgage Expert about 100% mortgages?
No deposit mortgages can be more specialist, and the right advice is often about more than simply confirming whether a product exists.
At Your Mortgage Expert, we can help you:
- Understand how 100% mortgages work
- Assess whether this route may be realistic for you
- Compare a 100% mortgage with alternative options
- Make sense of lender criteria and affordability
- Understand what documents may be needed
- Explore suitable options with High Street and specialist lenders
We help clients across the UK by phone and video, as well as offering in-person appointments where appropriate.