100% Mortgages lender Northern Rock could cost us 3,500 pounds each

If the nationalisation rescue of Northern Rock fails, we could all lose a possible 3,500 pounds each. The exposure to the tax payer’s money has doubled since the beginning of the year. Many borrowers who have borrowed against thier property with a 100% mortgage will owe thier money to the Bank of England.

100% mortgages have been the Northern Rocks loan of choice in the last few years. When credit conditions were relaxed and borrowing large amounts against on rising property prices was a safer bet.

It looks like The Bank if England wants its money back now. They will be aiming to reduce there mortgage based assets. When these 100% mortgages come to the end of there fixed rate period many borrowers will be looking to find a new competitive rate. Many 100% mortgages lenders are pulling out of the market Alliance & Leicester have announced a temporary withdrawal of there 100% mortgages and 100% plus mortgages products.