Worried about getting a mortgage with a small deposit? Don’t despair! The number of low-deposit mortgages available has jumped to its highest level in two years, offering a glimmer of hope for aspiring homeowners.

The latest figures from Moneyfacts show that there are now 361 different 95% loan-to-value (LTV) mortgages on the market. That means you could bag a mortgage with a deposit of just 5% of the property price! This is the highest number of 95% mortgages we’ve seen since May 2022.

And it’s not just good news for first-time buyers. The total number of mortgages available has surged to 6,658 – a level not seen since 2008! This means more choice and potentially better deals for everyone.

Fixed-Rate Mortgages See Small Rise

While the increase in low-deposit mortgages is great news, it’s worth noting that average interest rates for fixed-rate mortgages have risen slightly for the fifth month in a row.

The average two-year fixed rate is now 5.95%, up 0.02% from May, while the average five-year fix is up 0.03% to 5.53%.

However, there is some positive news on this front. Experts say the increases were modest, and rates are expected to stabilise soon.

Expert Advice: Shop Around and Seek Advice

Rachel Springall, a finance expert at Moneyfacts, had this advice for homebuyers and those looking to remortgage: “Borrowers who have a limited deposit may be pleased to see a rise in the number of mortgages available at 95% loan-to-value this month, reaching a 2-year high. However, those coming off a fixed-rate deal this year will note the average Standard Variable Rate is above 8%.”

Her message is clear – shop around for the best deals and seek advice from a mortgage broker to find the right mortgage for your circumstances.