Are lenders lowest mortgage rates benefiting many first-time buyers?

Lenders are fighting for the title of 'lowest mortgage rate', but as most of the historically low rates are for high deposits, is the competition benefiting many first time or small deposit property buyers?

One lender or another reduces mortgage rates most days, and recently attention has been turned to the first time buyer sector.

As well as reducing rates some lenders are also releasing smaller deposit mortgage products specifically targeted at the first time or the low deposit mortgage market.

The Office of National Statistics has released figures which reveal that in the last 15 years, the number of younger adults who are forced to remain living at home with parents, has increased by 20%. It is currently estimated that 3 million younger adults are still in the parental home.

Many have had to remain with parents because of high mortgage costs, from fees to rates to required deposit levels. However this could well change now lenders are actively competing for new business.

UK lenders are releasing their with lowest mortgage rates in a bid to lure customers, the reason they can release low rates is because of cheaper funding costs.

Some are competing for first time business. As first time mortgages at low deposit levels are riskier for lenders, the rates offered are not the lowest ever. However the release of more competitive rates for a smaller deposit is a positive step to  enabling more people to climb on the housing ladder.

While property prices are currently static and more small deposit deals are available, now could be the time to leave the parental home.

To achieve the lowest possible mortgage rate whatever your financial circumstances, you are advised to call independent 'whole of market' broker Deal Direct.

Call an adviser to find the right mortgage for your needs.