FTB and fed up with the LTV rates

[optimisticpessimist01]

DP and I have been looking at moving since about February, we initially had a DIP but this has since ran out. We have 10% deposit saved for a value of up to 250k (we live in Yorks so very realistic budget). But since we've been looking more recently at mortgages, we either wouldn't get accepted because our LTV rate is too low or the interest rates are shocking for those we would get accepted for

We can't borrow money off parents and because were renting it takes us a lot longer to save a substantial amount of money. Its infuriating because 10% should be very secure, and we are both teachers so our jobs are recession proof and we're pretty much guaranteed pay rises for the next 6 years at least.

Does anyone see any light at the end of the tunnel for the return of 90 LTV rates? Is it likely to come back once the demand of the stamp duty holiday has died out? We're feeling very disheartened and like we won't ever own a house at this rate (maybe being a tad dramatic there!)

Have you looked at what Teachers Building Society can offer you?

www.teachersbs.co.uk/mortgages-for-teachers

What sort of interest rates have you been offered that are shocking?

@StephenBelafonte high 3%, the rates before the increase in demand were around 2.5 sometimes even lower. In the grand scheme of things they're not shocking, but given the base rate and what they were earlier in the year they're not great

So take the 3% and change mortgage provider when the rate ends in 2 years. Surely that will still be cheaper than paying rent?

@StephenBelafonte our rent is £650pm, we figured out that mortgage repayments would be considerably higher than that by a couple hundred pounds. It is something I will consider though, its better to pay towards our own mortgage rather than someone else's!

Exactly. Pay the 3% for 2 years, then you'll get a better deal perhaps and only owe 23 more years on your mortgage. Or stay in rented for 2 more years and still not be a homeowner.

@StephenBelafonte

Exactly. Pay the 3% for 2 years, then you'll get a better deal perhaps and only owe 23 more years on your mortgage. Or stay in rented for 2 more years and still not be a homeowner.

This!

I'm absolutely not an expert here, but look into forecasts for interest rates... it may be that they go up in 2/3 years so make sure that would still be affordable

Whilst I have some sympathy - ie you were nearly there & hurdle now raised, this is EXACTLY the position in 2010/ 2011 when I bought, I had planned on 10%, had to increase my deposit (bye bye lovely sofa), & it took several years (I think 2-3) for 90% LTV to be come common again. So many FTBs this time around are in same boat

Looking into a specific mortgage for your profession sounds like a great idea, & not an option that is open to everyone

BTW - such low mortgage rates is hugely unusual, my parents have told me about paying 17%, and I looked back to check, yep in 1979

www.mortgagestrategy.co.uk/analysis/historical-interest-rates-uk/

Huge sympathies OP. I know many people have been much worse affected by Covid than FTBs, but when you thought you were almost there, and then the rug gets pulled out from under you, it IS heartbreaking.

Do what works for you, but one way of looking at it is that banks are protecting you (and themselves). Hard to stomach, I know, but waiting a while longer might serve you better in the long term.