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95pc LTV products up 57pc

Sarah Davidson

February 25, 2015

There are now more 95% LTV mortgages for homebuyers than at any time since the recession – as borrowers had the choice of 182 products in January.

The number of available products has increased by nearly a third (29%) from October alone, as more lenders cater for first-time buyers.

Simon Crone, Genworth vice president – mortgage insurance Europe, said: “For many aspiring first-time buyers, raising a deposit of 25% is simply not an option, so the growth of 95% LTV products is a welcome sign.

“Help to Buy has clearly restored confidence among lenders to start offering these loans after a severe drought during the recession.

“It is encouraging to see more products emerging outside Help to Buy, and a growing number of building societies are using private mortgage insurance to help them compete.”

The average rate for Help to Buy products dropped by 0.46% from December 2014 to stand at 4.79% in January 2015.

However the average first-time buyer borrowing at 95% LTV still has to pay rates 71% higher than one borrowing at 75% LTV.

Crone added: “The government scheme still accounts for a third of products and questions remain in the longer-term about how competition will fare when Help to Buy ends.

“Our analysis also suggests that capital constraints are continuing to having a negative impact on pricing for consumers.

“We need an industry-wide solution to address this and ensure that supply does not dry up again once government support ends.”


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