HSBC has axed its mortgages for those with small deposits of only five per cent.

The lender today said in an update it had removed all 95 per cent loan to value (LTV) mortgages from sale.

Earlier this month, HSBC had put all applications of mortgages above 90 per cent LTV on hold, alongside new build applications.

Michelle Andrews, HSBC UK’s head of buying a home, previously said: “We remain open for business and we want to support our customers and the housing market. Our mortgage range across all LTVs is still available and open for applications, and we aren’t seeing upward pressure on pricing…

“We will, of course, continue to review the situation regularly and hope it isn’t too long before the market returns closer to normal.”

Many lenders have withdrawn all lending above 75-80 per cent LTV in response to the coronavirus and limitations on physical valuations.

The government has urged all buyers and sellers to postpone transactions until social distancing restrictions have been relaxed.

But borrowers who are looking to remortgage deals at high LTVs could struggle to do so in the current climate.