High loan-to-value mortgage rates still much higher

Borrowers with small deposits are paying substantially more for mortgages according to latest figures from independent financial research company Defaqto.

David Black, Banking Specialist at Defaqto said: "Three years ago there was little difference in the interest rates charged whether you had a 10% deposit or a 25% deposit. Since the credit crunch the situation has changed significantly and those seeking a higher Loan-to-Value (LTV) mortgage have to pay significantly more."

He added: "The keenest rates are for those seeking a mortgage of less than 75% LTV. Mortgages permitting 90% LTV are significantly more expensive. First time buyers are particularly hard hit as they need a substantial deposit merely to get on the housing ladder and a significantly larger deposit to access the best rates."