| M | T | W | T | F | S | S |
|---|---|---|---|---|---|---|
| « Aug | ||||||
| 1 | 2 | 3 | 4 | 5 | 6 | 7 |
| 8 | 9 | 10 | 11 | 12 | 13 | 14 |
| 15 | 16 | 17 | 18 | 19 | 20 | 21 |
| 22 | 23 | 24 | 25 | 26 | 27 | 28 |
| 29 | 30 | |||||
First time buyers face an even greater struggle to get on to the property ladder, after 125 per cent mortgages disappeared from the market last night. Northern Rock and Birmingham Midshires were the last two lenders offering 100 per cent-plus home loans, but both decided to withdraw their deals amongst concerns over credit conditions.
These 125 per cent deals were popular with first timers as they allowed them to take out a 95 per cent mortgage alongside a loan usually capped at £30,000. It meant homebuyers could purchase without a deposit and use the remaining money to pay for stamp duty and furnishing.
It looks increasingly likely that all buyers will be forced into saving for a deposit from now on. Twelve lenders have withdrawn their 100 per cent deals in recent months, the most recent being the Bank of Scotland this week. The main cause of this pull out appears to be concerns that many homeowners are at risk of negative equity.
A sudden collapse in the property market could leave many owing more than the value of their home and unable to pay off their loan. Though interest rate drops have eased the situation slightly, the Bank of England has vowed not to follow the example of the United States and announce huge cuts.
“Lenders are pulling the deals because of the prospect of falls in house prices,” said David Hollingworth, of mortgage broker London
robert wood - compare mortgage deals