Only 1% of all mortgages taken out in July were for borrowers with a 5% deposit as tough criteria means many buyers do not qualify, figures from Trussle suggest.

The broker’s own completion data shows minimal uptake of 95% LTV mortgages, despite a significant increase in the availability of such deals since March this year.

There are now 49 lenders offering 95% LTV deals, but the number of products remains well below 2019 levels.

In July, there were 372 deals on the market, compared with a peak of 949 in November 2019.

Trussle says that the low uptake is not down to a lack of demand, but rather the difficulty of qualifying for such deals. 

It reports strong interest in 95% mortgage deals, peaking at 26% of all new mortgage enquiries in March.

However, few have been successful in their application. 

High LTV mortgages are subject to stricter lending criteria, require higher credit scores and borrowers cannot normally use gifted deposits.

Many lenders exclude flats and new-builds.

Trussle’s data shows that 60% of all those enquiring about 95% LTV mortgages were first time buyers, while second-steppers made up 34% and remortgages accounted for 6%.

Trussle head of mortgages Miles Robinson says: “The return of 95% mortgages earlier this year was greeted with much anticipation. 

“With greater application scrutiny and soaring house prices, first time buyers were facing a challenging market and these high LTV deals are crucial to ensuring home ownership remains an accessible dream for all.

“There is clearly an appetite for high LTV mortgages, as we have seen significant demand for 90% LTV deals, however, after making a real comeback in March it is disappointing that 95% deals are failing to make the difference we hoped to see.”