80 20 Mortgages are becoming more commonplace, and offered as an alternative to the previously popular 100% mortgage deals of late. The provision of these type of mortgage loans as an alternative is simply because it rebalances the level of risk which the mortgage lender is undertaking, by only lending 80% of the mortgage debt and not the full 100 mortgage previously on offer.

The remaining 20% is funded by the borrower, and can comprise of a loan (some lenders are offering interest free loans), a cash deposit raised by themselves or family members or as a combination of these funding methods in order to reach the required amount for the 100 mortgages in order to pay the seller the full asking price of the property that the investors wish to buy.

80-20 mortgages have been introduced in recent years, with alternatives including the 75/25 mortgage, 90-10 mortgage loan etc, where the lender loans the biggest chunk of the mortgage and the remaining finance needs are funded by the borrower.

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