Mortgage Lenders across the board have removed their 125% Mortgage products, as concerns mount over the viability of lending more than a home’s value. This is partly due to the prospect of falling house prices, and also due to concerns over subprime mortgage defaults.
There is also increasing desire amongst the top mortgage lenders to secure a bigger mortgage deposit. Nationwide announced that unless first time buyers could secure a deposit of 25%, they would face higher penal rates. With average house prices reaching £200,000 there are likely to be very few first time buyers able to benefit from the cheaper rates. nationwide to require 25% deposit
Good News
The only good news for first time buyers was the 5th monthly decrease in house prices. According to hometrack, the average price of homes in the UK fell 0.2% last month. This gives an annual house price inflation of only 1.2%, one of the lowest house price indicators. In other house price surveys the Institute of Chartered Surveyors said that house prices declined in every region during May.
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[...] they will be charging higher rates to first time buyers who don’t have a 25% deposit (link). This is bad news for long suffering first time buyer. If you consider that average house prices [...]
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