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FTBs fail to take up 95pc LTV deals
The number of 95% loan to value mortgage deals available is at the highest level since before the financial crisis but there are only 520 first-time buyers a day, figures from the Mortgage Advice Bureau reveal.
The broker said there could be over £210m worth of mortgage finance available to first-time buyers with a 5% deposit.
MAB said this was sufficient for over 2,000 first-time buyers to buy their home every day based on figures from Halifax’s first-time buyer review.
The number of 95% LTV deals currently open to first-time buyers is at a four year high with 59 deals currently available from 21 different lenders. This is up from just 25 in February 2011, nine back in February 2010 and only three the same month in 2009.
Brian Murphy, head of lending at MAB, said first-time buyers were being held back from taking up these deals only because they were unaware that they were available again.
He said: “Well over 85% of young renters aspire to become homeowners but the vast majority of these say the fact they cannot raise a deposit is the key reason for not buying.
“There is a widespread perception that a minimum 20% or 15% deposit is required and they just don’t realise that there are now a lot more competitive 90% and 95% LTV mortgages back on the market.
“The first port of call for prospective borrowers should be to a mortgage broker as they can best assess which is the best product for their needs, but the fact that lenders are open to first-time buyers again is a really positive sign.”
- Value of UK housing soars in past decade
- Brits struggle to save more
- More Brits exaggerated home claims in 2011
- Number of FTBs climbs 7pc in Dec
- Partnership raises LTVs by 20pc
- Bright Grey launches Lifestyle Plus product
- Barclays launches future fix range
- End of stamp duty holiday encourages FTBs
- Paymentcare boosts commissions by 10pc
- Leeds launches 2-year tracker
- Teachers launches ERC free tracker
Peter wrote:
Is this not more likely down to FTB's not wanting to buy into negative equity? No-one is able to produce any evidence that house prices are on the rise any time soon.
13 February 2012 12:30:15 GMT
Recommend? (5)Cath Hearnden wrote:
If all 95% FTB deals were available through intermediaries as well as direct then maybe more FTB would be aware of and have access to these deals. Evidence shows that FTB are seeking advice. If all deals were available through both channels then the banks would be able to lend more and get the market moving which is supposed to be the general idea isn't it?
13 February 2012 14:37:12 GMT
Recommend? (0)martin tapper wrote:
This article is absolutely bang on the nail. It is staggering to listen to the silence of the brokerage industry, lenders and providers. It is nauseating to listen to pundits on BBC Radio 4 repeating their ignorance time and again that it is necessary to have a "20% deposit" to buy a house. If you are a broker and you read this and you have an ounce of sense, put pen to paper! Tweet! Blog! Do whatever it takes and put the message out; LOW DEPOSIT MORTGAGES ARE AVAILABLE! As to negative equity - Oh! Be QUIET! People need to live somewhere and should not be thinking about making a quick buck. That said, in 10 years time prices will have overtaken us again, as they will inevitably rise in a country that has a growing population on the same amount of land. SPREAD THE WORD!
13 February 2012 19:31:15 GMT
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