Credit availability to increase for first time buyers

20-Jan-2012

The latest Trends in Lending report from the Bank of England (BoE) has signalled that there will be an increase in credit for first time buyers in the first three months of the year.

Borrowers with a high loan-to-value ratio will benefit most from the increase, as lenders attempt to offset the slump in the property market.

Rental values have seen a significant increase recently, largely due to the unaffordable nature of the first time property market. According to LSL Property Services, Christmas expenses and the hike in tenant finances left 10.7 per cent of all rent late or unpaid in December, compared to 9.3 per cent in November.

HSBC has contributed significantly to the positive outlook reported in the BoE Trends in Lending Report, setting aside at least £15 billion for mortgages this year, including £3 billion solely for first time buyers. This will benefit 27,000 first time buyers which will represent a market share of 11 per cent for 2012.

The Co-operative bank plans to take similar measures by offering £600 million buy-to-let loans this year.

Published by Sam Franklin

Rent to Buy can make a good solution for first time buyers looking for a compromise solution

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