Growth in number of approvals to small deposit borrowers

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First-time buyers and existing homeowners capitalised on low rates across the market last month.

The latest Mortgage Monitor from e.surv has reported that there were 67,011 mortgages approved during the month of October (seasonally adjusted).

This figure is 2.7% higher than September’s approval figure and is also up on the previous October. Approvals were 3.5% above the level found in the same month a year ago.

E.surv said that despite the Bank of England base rate being raised at the start of August, mortgage rates have remained comparatively cheap, tempting more borrowers into the market.

First-time buyers have also continued to come to market, taking a larger share of mortgage approvals than a month ago.

Some 24.6% of all loans went to borrowers with smaller deposits this month, higher than the 24.2% recorded in September.

Transactions are likely to tail off as the year comes to a close, as buyers prefer not to move close to the Christmas period.

However, e.surv said those existing homeowners looking to remortgage may swoop to grab a cheap mortgage deal while they last, given rates have ticked up since the base rate rise occurred in August.

Richard Sexton (pictured), director at e.surv, said: “Most agree there appears to be little prospect of another increase in the Bank of England’s base rate between now and the end of the year, yet that is no reason for potential remortgage customers to halt their search.

“With rates still at historically low levels across the board, there are great deals to be found at both high street mortgage lenders and more specialist banks.

“Homeowners should chat to a mortgage broker to see what deals are available to them, and capitalise while mortgage loans are still available with cheap rates.”

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