The 100% Loan-to-Value (LTV) mortgage product, aimed at first-time buyers with little or no deposit, has been successfully trialled in the East Midlands.
It is a five-year fixed rate mortgage with an interest rate of 5.99%. The application fee is £199 and the cashback is £199 on completion.
Simon Taylor, CEO of Melton Building Society, said: “It is well documented that taking the first step towards home ownership has become increasingly difficult for buyers in recent times.
“As a modern collaborative building society, it is important that we look for ways to innovate and provide solutions to overcome the barriers that exist to home ownership.
“That’s why we’ve carefully designed a product that, in partnership with Gable Sure, gives borrowers a fair chance to own their own home while borrowing responsibly.”
2026: The year of the first buyer innovation
This is one of many innovative new mortgages designed for first-time buyers to be launched in 2026.
Earlier this month, Santander unveiled ‘My First Mortgage’ – a 98% loan-to-value deal for those with a minimum deposit of £10,000. It has an interest rate of 5.19%, no product fees and offers £250 cashback.
In January, Hanley Economic Building Society launched its ‘Rent to Own’ mortgage, a zero deposit deal for reliable renters with a 5.79% interest rate fixed for five years.
And it comes as Skipton Building Society has updated its ‘delayed start’ mortgage, giving first-time buyers a three-month break from repayments at the start of their deal, and as Family Building Society has relaunched its 100% LTV family mortgage.
It’s no wonder that 2026 is being hailed as ‘the year of the first buyer’.
Kylie-Ann Martin, director of Selby-based KAG Financialspeaking to the Newspage agency, said: “2026 is lining up to be the year of the first buyer – and rightly so.
“After a few years of shaky interest rates, rising rents and a lack of low deposit options, lenders have listened to the market and that, combined with a rate war, is a great thing for buyers.
“I’ve been in the industry for 17 years and can’t remember a time when there were so many different options available for people with smaller deposits, even those without perfect credit.
“We speak to many buyers who have put off looking at their options due to higher rates, and now they are in a much better place – many first-time buyers are planning to make 2026 the year they become homeowners.”
Patricia Ogunfeibo, founder and non-practicing attorney at Tenant2owner, based in Londontold Newspage: “Melton is doing what building societies were set up to do, and a simple check using our ‘rent vs buy’ calculator will help the individual see whether paying the 5.99% rate makes sense for them.
“If you’re a renter, talk to an agent who covers the whole market, because you could be closer to ownership than you think.
“The deposit shortage is not a character flaw, it’s a structural problem. And it’s great to see Melton helping to close this problem.”