British mortgage brokers say that they are starting to see lenders broadening the range of high LTV deals, which fact can be explained by the release of new data on house prices. Better mortgage deals mean that first-time buyers will have higher chances on climbing the property ladder.
One of the largest British lenders, the Lloyds TSB banks, which controls almost 30% of the UKmortgage market and which is owned by the Lloyds Banking Group, is expected to announce the launch of new deals for buyers with minimum deposits. The deals will expectedly include several 3-year fixed mortgage offers.
Another lender that made a concession for first-time buyers is the Coventry Building Society, which has cut its interest rate for buyers with a 15% deposit to 4.99%, 1% down from 5.99%. However, FTBs should realize that the previous rate was fixed for 5 years, while the new one is variable. The good news is that the newly launched mortgage offer comes with a fee of mere £499 and does not have any early repayment charges, which means that borrowers can easily switch to fixed deals in case interest rates start to rise.
Mortgage brokers warmly welcome the moves, undertaken by some of the British lenders. They add that the particular mortgage deal, launched by the Coventry Building Society, will be highly attractive to UK first-time buyers, who have been having hard time getting on a property ladder lately.
On the other hand, a wider range of high LTV mortgage deals does not mean that the banks have loosened their lending criteria. In fact, borrowers with low deposits wishing to qualify for a newly launched mortgage deal have to have a spotless credit history.
Let us remind that British lenders explain the introduction of new high LTV mortgage deals by the house price data, recently released by RICS and other organizations.
Although the data suggests that property prices are starting to stabilize, some of the British lenders, such as Abbey, Woolwich, Yorkshire and Chelsea building societies, chose to increase their interest rates in order to manage the increased inflow of mortgage applications.
Source: E1 BTL Finance
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