First-time buyers’ mortgage with £5,000 deposit and £500k limit launched – but there are some restrictions
First-time buyers are being offered the chance to pay a modest £5,000 deposit and potentially borrow up to 99% of a property’s value.
The mortgage from Yorkshire Building Society is valid on places up to £500,000 and comes without a fee – but there are a few key exceptions.
It’s not available for flats or new-build properties and would-be borrowers must pass strict affordability and credit scoring checks.
The task of saving for a deposit is one of the barriers that many first-time buyers struggle with as most lenders like a minimum 10% up front.
Yorkshire Building Society’s mortgage director, Ben Merritt, said its research suggested £5,000 was the sum that could help young people get on the property ladder.
He said it could help produce a “level playing field for those who don’t have financial support from their families to fall back on”.
Buyers need at least £5,000 as a deposit under the deal, which offers a five-year fixed interest rate of 5.99%.
The building society isn’t the only lender to offer deals aimed at first-time buyers, with 5% deposit deals available elsewhere. However they often come with higher interest rates.
With a small deposit, there is also a greater risk of falling into negative equity – owing more than your home is worth – if a property falls in value.
Skipton Building Society is another lender that has launched a product for first-time buyers.
Its track record mortgage looks at previous rent payments to assess what a person may be able to borrow – and a deposit is not required.
Again though, there are restrictions that mean new-build flats are excluded.
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Rachel Springall, from Moneyfactscompare.co.uk, said the Yorkshire mortgage would likely prove popular among first-time buyers and it would be interesting to see if others launch similar deals.
However, she cautioned that a larger deposit is always preferable and should work out cheaper long term.
“Anyone who borrows at a higher loan-to-value would be wise to overpay their mortgage whenever they can to gain more equity and aim to reach a lower loan-to-value bracket where cheaper deals could be found when they come to refinance,” said Ms Springall.
Higher interest rates in the last few years have also made mortgage repayments more expensive, but rates are expected to start to fall later this year as inflation is now nearing the government’s 2% target.
UK
Ireland pledging emergency legislation to send asylum seekers back to UK in wake of Rwanda bill being passed
Ireland is pledging emergency legislation enabling it to send asylum seekers back to the UK.
More than 80% of recent arrivals in the republic came via the land border with Northern Ireland, Irish justice minister Helen McEntee told a parliamentary committee last week.
Rishi Sunak told Sky News it showed the UK’s Rwanda scheme was already working as a deterrent after it finally became law last week.
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Ireland plans to return migrants to UK
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Ireland’s deputy prime minister has said the threat of deportation to Rwanda is causing migrants to head for Ireland instead of the UK.
Micheal Martin said the policy was already affecting Ireland because people are “fearful” of staying in the UK.
The former taoiseach told The Daily Telegraph: “Maybe that’s the impact it was designed to have.”
Protesters in Dublin. Pic: PA
Simon Harris, Ireland’s latest leader, has asked Ms McEntee to “bring proposals to cabinet to amend existing law regarding the designation of safe ‘third countries’ and allowing the return of inadmissible international protection applicants to the UK”, a spokesman said.
Ms McEntee said she will be meeting UK Home Secretary James Cleverly in London on Monday.
“There are many reasons why we have seen an increase in migration towards Ireland,” she told RTE.
“My focus as minister for justice is making sure that we have an effective immigration structure and system.
“That’s why I’m introducing fast processing, that’s why I’ll have emergency legislation at cabinet this week to make sure that we can effectively return people to the UK, and that’s why I’ll be meeting with the home secretary to raise these issues on Monday.”
People are now “worried” about coming to the UK, Rishi Sunak has said.
He told Sky News: “If people come to our country illegally, but know that they won’t be able to stay here, they are much less likely to come, and that’s why the Rwanda scheme is so important.”
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Mr Sunak said the comments from Irish politicians show that “illegal migration is a global challenge”.
“[That] is why you’re seeing multiple countries talk about doing third country partnerships, looking at novel ways to solve this problem, and I believe [they] will follow where the UK has led,” he said.
Shadow minister Wes Streeting said it was unlikely a Labour government would bring people back from Rwanda if some are sent there.
“Once people are settled in Rwanda, they’re settled in Rwanda,” he told Sky News, adding it was doubtful that Labour would “unpick that situation”.
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Regarding illegal migration in general, he said it required “putting the money that’s gone to Rwanda into the National Crime Agency so we can have proper cross-border policing to tackle the criminal gangs, speeding up the processing of decision-making, making sure we’ve got serious returns agreements with other countries”.
He added: “Those are solutions that can work.”
UK
Prince Harry returning to UK for first time since visiting King Charles following his cancer diagnosis
Prince Harry is returning to the UK next month for the first time since his rushed visit to see the King after his cancer diagnosis.
The Duke of Sussex will attend a ceremony on 8 May marking the 10th anniversary of the Invictus Games.
The service of thanksgiving at St Paul’s Cathedral is the first major event he has attended in Britain for some time.
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It is not known if any other royals will be in attendance at the service, or if the Duchess of Sussex or the couple’s children will be in the UK.
Harry made a brief trip to the UK in February, spending about 45 minutes with his father, who had just started treatment for cancer.
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The duke is expected to provide a reading at the event, which marks a decade since the inaugural Invictus Games in London in 2014.
The games were founded as a sporting event for injured and sick military personnel and veterans.
Actor Damian Lewis is set to recite the Invictus poem during the service.
Representatives from across the Invictus Games participating nations, including members of the wounded, injured and sick service personnel and veteran community, will also be in attendance.
A man has died following a parachute incident at an industrial estate in County Durham.
Police were called to South West industrial estate in Shotton near Peterlee at 12.30pm on Saturday.
A man in his 40s was pronounced dead at the scene.
Police are appealing for anyone who has dash cam footage of the moments leading up to the fatal incident.
They said they are treating the death as unexpected and inquiries are ongoing.
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Fire and ambulance services also attended, Durham Constabulary said.
Detective Chief Inspector Mel Sutherland, who is leading the investigation, said: “Officers are keen to speak to anyone who was travelling on the A19 at around 12.20pm to 12.30pm who may have mobile phone or dashcam footage which captures the moments leading up to the incident.
“Our thoughts remain with the man’s family at this time.”
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