The first-time buyer mortgage post code lottery

Those buying their first home in some parts of the midlands and the north of England will find more mortgage choice available than their peers in the south. Research from Moneyfacts.co.uk reveals there is now a postcode lottery for the number of mortgage deals available to first-time buyers at 90% loan-to-value (LTV) with those in the north west, midlands and Yorkshire potentially having more than twice the choice of those in the south.

There are now four lenders with 15 mortgages available for first-time buyers in England and Wales at 90% LTV that are available directly from the lender. This includes home purchase plans available from Al Rayan Bank. Those living in areas served by Cumberland Building Society, Darlington Building Society, Furness Building Society and Stafford Railway Building Society can also choose from an additional 17 mortgages available, totalling 32 available to those buying in these regions. So, more than double what is available nationwide to those in the south.

Buckinghamshire Building Society has just launched two 90% LTV first-time buyer mortgage available to those buying in Buckinghamshire only – in addition those that are existing customers or related to an existing customer of the building society (such as children, parents, grandparents and grandchildren) can benefit from a reduced interest rate.

Even with this new launch those living in the south of England will need more regional lenders to come forward to make the availability of 90% first-time buyer mortgages more equal between those buying in the north compared to the south.

The Scottish Building Society also has availability at 90% LTV but for Scotland only.

^{Source: Moneyfacts.co.uk Sept 2020}

^{Source: Moneyfacts.co.uk Sept 2020}

There are five lenders that offer 90% LTV first-time buyer mortgages to restricted locations in England and Wales only. The map shows the areas covered. 

Source: Moneyfacts.co.uk data September 2020

Note: Cumberland Building Society lending does include Dumfriesshire in Scotland.

First time buyers can either look to increase their deposit to qualify for an 80% or 85% LTV and as a result access an increased choice of products or consider a guarantor mortgage. A Lifetime ISA comes with a Government bonus to help boost your house deposit savings.

Read more in our guide to saving for a house deposit

Those wanting to buy a new build property can apply for a Help to Buy loan from the Government. Help to Buy loans are available to all home buyers if they buy a new build property and not just first-time buyers. The loan is for up to 20% of the house price outside of London and up to 40% in London. The buyer needs to save a 5% deposit. The loan is repaid either when the property is sold or after 25 years.

Read more about Help to Buy loans.

A mortgage broker can help to identify any exclusive deals not available to members of the public. They also know the lending criteria of different providers and can help to match your circumstances to a lender most likely to accept you.

Speak to a broker