Lenders 'more favourable on shared equity'

11-Mar-2009

Britons looking to get on to the property ladder might enjoy more success from lenders if they are looking for shared equity schemes rather than shared ownership deals, it has been suggested.

In its News & Views publication this month, the Council of Mortgage Lenders (CML) claimed that lenders willing to embrace low-cost home ownership are more likely to favour shared equity.

The mortgage trade association stated: "It is less complicated and risky in the current housing market."

Low-cost home ownership initiatives, which could assist prospective first property buyers, are supported by the government, but the CML said lenders are reluctant to consider loan-to-value rates close to 100 per cent on any type of loan.

After meeting with lenders and stakeholders last month, the body has issued policy recommendations which include simplifying the range of schemes and providing more information on arrears rates.

Glasgow-based first-time buyer Amy Ross got on to the property ladder using a shared equity scheme - without which she would have had to save an extra £20,000 to afford her bank's revised mortgage borrowing criteria in the economic downturn, the Observer reported on Sunday.

FirstRungNow.com - how to buy a house, from finding your first flat or first house, first time buyer mortgages, shared ownership, buying with friends, gifted deposit, part buy part rent - all a first time buyer could possibly need.

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