Mortgage lenders commit to first time buyers

06-Feb-2012

Mortgage lenders expect the availability of secured credit in households to increase slightly in 2012, which has resulted in an increase in mortgages available to first time buyers.

According to MoneyFacts, there are currently around 49 mortgage deals available at 95 per cent loan to value (LTV) which is more than double the 24 on the market in January 2011. Furthermore, the number of deals available to those with a ten per cent deposit has also increased in the past two years from 114 to 332.

The news comes as lenders look to increase their commitment to first time buyers, with big banks setting aside larger proportions of credit for those making the first leap onto the property market. HSBC has announced that it will lend a minimum of £15 billion in mortgages, with £3 billion dedicated to first time buyers. Nationwide are also showing their commitment to first timers, declaring that they ‘do more for first time buyers’.

However, the increase in commitment doesn’t mean banker confidence has been appeased. First time buyers may struggle to get a mortgage at a good rate if their credit history is poor, which is likely to mean credit is still not that easy to get hold of.

David Newnes, director of LSL property services, suggests “with the mortgage market facing challenges from the euro zone crisis and the sluggish wider economy, the number of first time buyers able to secure finance is not about to rocket up”.

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

Published by Sam Franklin

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