First time buyers and 100% mortgages borrowers could be the worst hit. As lenders tighten up and demand they put down bigger deposits.
More bank and building societies require larger deposits where deals only required 3% or 5% deposits they now require 10%.
100% mortgages lenders Accord have stopped their 100% mortgages altogether. Norwich and Peterborough have also scrapped their 100% mortgages and 95% products. Leeds Building Society now requires anyone taking out their 100% mortgages deal to have a guarantor.
Lenders caution follows criticism they were irresponsible loaning out more than borrowers could afford to pay.
First time buyers are being squeezed out the market.
Will the liquidity problems and unexpected losses from securities linked to US bad credit mortgages lending will worsen in the months ahead.
The wave of problems will be first felt in the bad credit mortgages sector, and then the rest of the financial services industry. Trying to assess how widespread the damage is will be difficult.
The supply of bad credit mortgages approvals is expected to deteriorate further. Mortgage lenders are raising their rates; Bad credit mortgages rates will have the greatest increases.
The credit squeeze and the problems at Northern Rock have dominated the public statements of members of the Monetary Policy Committee this week, bad credit mortgages is everyone’s topic of conversation.
Cameron says he will abolish the tax for first-time buyers on properties worth up to £250,000.
Good news for first time buyers & 100% mortgages borrowers. This would help 9 out of 10 first time buyers. Most people lending on the 100% mortgages products would see drastic savings on their purchase costs.
Times that the announcement shows the Conservatives are the ‘party of aspiration, giving you power and control over your life’. Any saving to ease the burden of trying to get onto the property ladder would help all first time buyers and borrowers of 100% mortgages.
This is one of the biggest cost first time buyers and 100% mortgages borrowers have to find.
