Will mortgage lenders penalise someone who has a small / no deposit by only offering a higher interest rate?

And is it true that banks avoid people who want 100% mortgages?Will mortgage lenders penalise someone who has a small / no deposit by only offering a higher interest rate?
No, it depends upon their credit history.


There are 3 categories


1.Sub prime (very bad credit history)


2. Near Prime (not bad)


3. prime (very good)


So, sub prime customers get very high interest rate to avoid risk involved in lending.


This is how it is calculatedWill mortgage lenders penalise someone who has a small / no deposit by only offering a higher interest rate?
Yes - after all, if they have to foreclose, they will not get 100% of the value of the house back.
Most high street banks dont offer 100% mortgages but its best that you contact a few brokers who can do all the legg work for you, just becareful on how much they these other companies charge for a 100% mortagage!





Yes you will have to pay a slightly higher rate then normal but then you cant have everything!





With the way the market is going you maybe better off saving a depoist and watch what happens to the housing market over the next 6 month. Im sure the bank will lower their rates again to get the market moving again.
Yes.





To get the best rate you need a 40% deposit (i.e. borrow max. 60%).





Typically, if you borrow 80% or over they will insist you pay out for Payment Protection Insurance.





Few places offer 100% anymore .. those that do will have high 'application fees', long 'tie-ins' / penalty clauses and typically offer higher rates (or no 'special offers')
it depends on your credit score%26gt; for your intrest rate... the interest rate is always negotiable too.


lenders can still do 100%, but after all the arms %26amp; subprime loans going in forclosure, they are really trying not too. again what is your score???
Many banks and even FHA loans are asking for 20% down and give backs from the builders. I sold a house I built, and the FHA bank was asking for a 10 year warranty. Unreal.





Housing prices are not going up in most places. but that is still based on LOCATION%26gt; My advice is to do some checking to see what a existing house sold for last time. Doing some leg work at the recorders office can save you MANY thousands. and give you a much better bargaining position.
The larger the deposit often means a better rate.





Not many high street banks offer 100% mortgages but there are lenders who do. Speak to a mortgage broker who will have access to the whole market.
Best advice is to speak to an IFA (independent financial advisor)


It is true, some banks won't lend 100%. some charge a higher interest rate the greater the %age they lend.





an IFA will be able to explain the ins and outs... try and get one by personal recommendation.... most don't charge for an initial meeting