100% Mortgages Are Back – A Sign of Market Confidence?
29 May, 2025
April Mortgages has just made a bold statement. 100% loan-to-value mortgages are back, and that tells us something important about lender confidence in the property market.
These no-deposit products are targeting first-time buyers and home movers with rates from 5.99%, fixed for 10 or 15 years. It's a clear signal that lenders believe in property's long-term stability.
The Appeal Makes Perfect Sense.
For renters in Sussex watching their monthly payments disappear into someone else's pocket, this could be a game-changer. Why spend years saving a deposit when you could be building equity in your own home instead?
House prices locally have shown resilience, and 100% mortgages offer a genuine pathway to homeownership for the right borrower in the right circumstances.
Understanding the Risks:
Yes, there are considerations. You need to be confident in your long-term plans without that traditional deposit buffer. Property values can fluctuate, and adding in stamp duty and legal fees means you'll need to accept that at first the numbers will be very tight.
But here's the thing – if you're planning to stay put for the long haul, short-term market movements become less relevant. Time in the market beats timing the market, as the saying goes.
Market Confidence Indicator:
What's really interesting is what this product launch tells us. Lenders don't offer 100% mortgages unless they're genuinely optimistic about property fundamentals. They're backing their belief that UK property remains a solid long-term investment.
Recent inflation figures hit 3.5% – above the Bank of England's 2% target. But property has historically been an effective inflation hedge, and lenders clearly see this too.
The Right Circumstances:
We see how the right mortgage product can transform someone's housing situation. For stable borrowers with secure income and long-term plans, 100% mortgages could work brilliantly.
The key questions aren't about market doom – they're practical ones. Can you comfortably afford the payments? Are you planning to stay put for several years? Do you have emergency funds for unexpected costs?
A Positive Development:
This isn't just reckless lending – it's innovation responding to genuine housing challenges. When traditional routes to homeownership feel blocked, creative solutions deserve consideration. It’s good to see.
The Bottom Line:
100% mortgages represent renewed confidence in UK property. For the right borrower with realistic expectations and long-term plans, they could be exactly what's needed.
The key is honest self-assessment. If the numbers work and you're in it for the long haul, take independent advice, work out best and worst case scenarios and then, if it works, why not consider it?
This article provides general commentary only and should not be considered financial advice. Always consult qualified financial advisors before making mortgage or property investment decisions.