If you want to land with a very competitive and affordable mortgage deal then be ready to pay bigger deposit deals. These are the findings put forward by Moneyfacts, the leading finance advice website. During the last year, home buyers with relatively smaller deposits had little chance of availing loans for house purchase. This trend got authenticated from the start of this year. According to the report, during the last one year, the number of mortgage for such buyers giving just 10 percent of the total value of the house to be purchased, has shrunk by 45 percent. According to the web-site's expert observations, 74.2 percent of the total deals could be grabbed by such house buyers who offer 10 percent or less loan-to-value ratio (LTV). Under the prevailing stringent financial climate, home finance consumers are more likely to secure a deal if they are able to put up a deposit ranging between 20 to 30 percent of the total value of the property to be purchased. Presently of all the loan packages available in the market, 38.7 percent of the total deals are grabbed by those consumers trying for a borrowing falling between 70 to 79 percent of the LTV.

Moneyfacts commented on the scenario: “Competition was one of the major factors when setting mortgages rates and best buys were awash with deals at 95 per cent LTV. Today, the overriding factor when setting mortgage rates is risk. Lenders are focusing much more on risk. They are making less products available to borrowers with a small deposit and making the few that are available much more expensive.”

Those who are unable to put up a sizable cash front as deposits, availing cheap loans might help their cause to increase the amount of their deposits.

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