It's possible to move home even if you can only scrape together a 5 per cent deposit, provided you shop around for a mortgage. Money journalist Neil Faulkner explains how.
A handful of mortgage deals let you buy a home without a deposit, usually if you can convince a parent or relative to be a guarantor.
However, there isn't much choice and there's a fair chance you won't meet any mortgage lender’s criteria.
But a government housing scheme originally aimed at first-time buyers has been extended to help those already on the property ladder take the next step.
NewBuy for home movers
The NewBuy Guarantee scheme was launched last year with the aim of helping prospective buyers onto the property ladder and building thousands of new homes.
It allows buyers to purchase newly built houses or flats using a 5 per cent deposit, instead of the 20 to 25 per cent downpayment more commonly demanded in today's mortgage market.
The NewBuy scheme has now been extended to allow existing home movers to part-exchange their old properties for new ones, with only a 5 per cent deposit.
This extension will run for at least the first six months of 2013.
NewBuy part-exchange: How it works
More than 40 housebuilders are signed up to NewBuy, which allows you to buy your own home worth up to £500,000 in England and £250,000 in Scotland.
With part-exchange, builders offering the NewBuy scheme buy your existing property while selling you a new-build home, and you only have to put down a 5 per cent deposit.
Apart from this, in every other way NewBuy part-exchange is exactly like buying and selling a property in the normal way.
You're fully responsible for getting a reasonable price on your old home and paying a fair price for the new one.
NewBuy mortgage deals
There are a number of lenders offering NewBuy mortgage deals.
David Hollingworth at mortgage broker London & Country has looked at some of the better deals currently available.
"Nationwide and NatWest have been the most competitive," he says.
Nationwide offers a two- or three-year fixed rate at 4.34 per cent, with a £99 fee.
Natwest also offers a two-year fixed rate at 4.49 per cent, as well as a five-year fix at 4.79 per cent.
Both of these deals are fee-free.
What's the point of NewBuy part-exchange?
You might be wondering what the point of yet another home-buying scheme is.
The intention is to move people up the property ladder, thereby freeing up homes for those further down such as first-time buyers.
The scheme is also aimed at encouraging more house building.
If you're able to buy the right home at a fair price you can comfortably afford, and sell your old home at a reasonable price, you could benefit from this scheme.
NewBuy in Scotland & Wales
The NewBuy scheme operates in England, but Scotland has a very similar scheme, MI New Home, which also now allows part-exchange.
And in Wales, NewBuy Cymru should be operational by spring 2013.
Help with moving home
Confused.com has a new HelpMeMove service which is a free, interactive moving home checklist.
It can help organise your move, from finding mortgage deals and conveyancers, getting quotes for removal companies, finding schools and doctors in your new location and even organising your new digital TV and broadband suppliers.