First time buyers need 3 per cent less deposit per month

Mortgageforce has found that the deposits demanded by lenders have been dropping month by month: their average deposit for First Time Buyers has decreased from 28.6% (June) to 25.4% in July and 21.25% in August.

Tucker comments: "More generous deals are available; the ongoing stability of house prices reduces the risk of negative equity and repossessions that lenders are keen to avoid, so we should see more accommodating terms from them now."

What deals are out there this week?

If you're borrowing 90% of the property value, HSBC have an amazingly low 3.89% discount for two years for a £1,199 fee, (Cost for comparison 4.1% APR). Up to 75% loan to value you can still get Market Harborough's discount with a current pay rate of 2.99% (that's a 2.5 discount from SVR of 5.49%) for two years: it has no Early Repayment Charge for an arrangement fee of £150, (Cost for comparison 5.5% APR) exclusively through Mortgageforce if you want whole of market advice; or via the lender directly.

Tucker adds: "Be wary that, unlike ‘trackers', ‘discount' rates may increase even if the official Bank Rate (currently 0.5%) does not: because they are a discount from the lenders' own SVR rate, which is changeable entirely at their own whim.

"Although tracker and discount rates are looking very low currently, first time owners or anyone on a restricted budget should consider very carefully whether they could continue to afford their mortgage payments if that rate does increase by a few percent."