In the last six months alone the number of mortgages available for loans up to 95% of the property’s value has fallen by 43% from 49 products to just 28. Looking specifically at loans for first time buyers, there has also been a significant reduction of mortgage options. In the last 12 months, first time buyer mortgage products have fallen by 31% from 1786 to 1225.
A number of lenders that were offering 95% mortgages six months ago have since withdrawn them from the market.
Clare Francis, mortgage expert at MoneySupermarket said: "Our analysis shows the continuing difficulty facing first time buyers and those with smaller deposits looking to find a suitable mortgage. Despite the launch of the Funding for Lending Scheme which was designed to encourage further mortgage lending by the banks, there appears to be few signs that the initiative is helping those with small deposits. It is still early days and we won’t see any data on the impact of the initiative until the end of the year, but so far there is little to indicate that the scheme will kick start the beleaguered mortgage market."
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