More mortgages are available this month, particularly for borrowers with deposits of between 20% and 25%, it has been revealed.
Data shows product availability has increased for the first time since June with 145 more products on the shelf in November than there were at the same time in October.
What’s more those obtaining mortgages for between 75% or 80% will benefit from more choice as this area of the market has seen the strongest growth.
But while this data from Moneyfacts.co.uk offers some signs of hope for borrowers struggling to obtain home finance, the effects of the pandemic on the mortgage market remain ever present.
Moneyfacts said average rates for two-year and five-year fixed rate deals – the most common types of mortgage – have increased again for the fourth consecutive month.
Borrowers taking out a mortgage for two-years at a fixed rate would be looking at an average interest rate of 2.43% which is 0.05% higher than last month.
Low deposit deals
What’s more lenders appear to be focussing their attention on less risky borrowers, and there are still very few mortgages available for borrowers with small deposits of 10% or under.
And the typical shelf life of a mortgage is at its lowest level on record, according to Moneyfacts, with deals remaining on the market for only 28 days, on average.
It means borrowers have a limited time to secure their product of choice.
All this comes in a time when demand for mortgages is at a high as borrowers rush to take advantage of the stamp duty holiday before the 31 March 2021 deadline.
Eleanor Williams, finance expert at Moneyfacts, said: “While areas of the UK acclimatise to a second lockdown, borrowers hoping to secure a new mortgage deal may do well to seek advice and support from an independent financial adviser, who will be able to use their knowledge of the market to assist with not only finding the right product for their circumstances, but also help with navigating potential concerns around any possible underwriting or conveyancing delays.”
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