[Moo!]

I've just heard on the grapevine that one of the big banks are providing 95% mortgages again for first time buyers. This is not advertised on their website and is only available when you go into the branch. The rates on offer are also very good.

Is this a sign that the banks now have more confidence in the housing market and do not expect prices to drop by much (if anything) in the near future?

I've always felt as soon as mortgages are back at 95% - 100% again the market would be flooded with first time buyers. This worries me. I'm reluctant to jump on the ladder because the risk of a massive drop post general election is too high in my eyes, but this news has thrown me. What are the banks thinking now!?

[moneyfornothing]

Moo!, on 09 February 2010 - 08:55 AM, said:

I've just heard on the grapevine that one of the big banks are providing 95% mortgages again for first time buyers. This is not advertised on their website and is only available when you go into the branch. The rates on offer are also very good.

Is this a sign that the banks now have more confidence in the housing market and do not expect prices to drop by much (if anything) in the near future?

I've always felt as soon as mortgages are back at 95% - 100% again the market would be flooded with first time buyers. This worries me. I'm reluctant to jump on the ladder because the risk of a massive drop post general election is too high in my eyes, but this news has thrown me. What are the banks thinking now!?

That will have to be a nationalised bank then .. they are legally bound to extend mortgages to a certain value by the end of Feb. I wouldnt be surprised if this was Lloyds HBoS - how the mighty have fallen - It must be a frenzy to get those mortgages out at any cost into the market now .. how the govt could make legally binding commitments on banks to encourage reckless lending that got them into this pickle in the first place beats all logic .. spring bounce well and truly on..!!

[Let's get it right]

Moo!, on 09 February 2010 - 08:55 AM, said:

I've just heard on the grapevine that one of the big banks are providing 95% mortgages again for first time buyers. This is not advertised on their website and is only available when you go into the branch. The rates on offer are also very good.

Is this a sign that the banks now have more confidence in the housing market and do not expect prices to drop by much (if anything) in the near future?

I've always felt as soon as mortgages are back at 95% - 100% again the market would be flooded with first time buyers. This worries me. I'm reluctant to jump on the ladder because the risk of a massive drop post general election is too high in my eyes, but this news has thrown me. What are the banks thinking now!?

I've just heard that the banks have got to pay the government back £300 billion that the government has lent them (on our behalf) to support mortgage lending.

The banks are lending money to people to buy houses - money which the government has itself borrowed by selling gilts.

We seem to be living in a nuthouse.

Where do the banks think the money to lend is going to come from when the government is forced to stop borrowing and printing money. Savers aren't going to provide the money.

This post has been edited by Let's get it right: 09 February 2010 - 09:18 AM

[SarahBell]

new qe goes directly into mortgages?

[Caveat Mortgagor]

Moo!, on 09 February 2010 - 08:55 AM, said:

I've just heard on the grapevine that one of the big banks are providing 95% mortgages again for first time buyers. This is not advertised on their website and is only available when you go into the branch. The rates on offer are also very good.

Is this a sign that the banks now have more confidence in the housing market and do not expect prices to drop by much (if anything) in the near future?

I've always felt as soon as mortgages are back at 95% - 100% again the market would be flooded with first time buyers. This worries me. I'm reluctant to jump on the ladder because the risk of a massive drop post general election is too high in my eyes, but this news has thrown me. What are the banks thinking now!?

This is quite possibly true. If so, I see it as another sign that the banks see the housing market falling.

This offer is not publicised. It may be something the banks want to pick and choose who knows about it. Maybe young career professionals (solicitors, doctors etc) on small LTVs who they feel they are more likely to work their way out of negative equity when it comes.

I bet they dont offer this deal to people on low incomes, lack of stable employment, working in the wrong businss sectors!

Just another way of sucking as much cash as possible away from the public and letting them carry the cost when the housing market is finally allowed to fall / can no longer be sustained at its current absurd level!

These deals smack of desperation. The endgame getting nearer perhaps?

This post has been edited by Caveat Mortgagor: 09 February 2010 - 09:11 AM

[moneyfornothing]

SarahBell, on 09 February 2010 - 09:07 AM, said:

new qe goes directly into mortgages?

QE is dead .. long live the SLS

[Bloo Loo]

Let said:

I've just heard that the banks have got to pay the government back £300 billion that the government has lent them (on our behalf) to support mortgage lending.

The banks are lending money to people to buy houses - money which the government has itself borrowed by selling gilts.

We seem to be living in a nuthouse.

Where do the banks think the money to lend from is going to come from when the government is forced to stop borrowing and printing money. Savers aren't going to provide the money.

lending isnt the problem.

the system is awash with money....an extra 200bn at the very least. and velocity has slowed...so the banks have tons of it.

Its borrowers they are short of.

so what do sellers do to move stock? they sell more cheaply...for lenders this means selling to more risky borrowers at a price that doesnt cover the risk....before 2007, they could sell this on packaged as MBS to be repackaged as Bonds with better returns than guilts, and NO RISK ( so they told everyone)

selling more cheaply led to A> bonuses and B> the unpayable debts and the credit crisis.

If the grapevine is true, then I see a problem.

[moneyfornothing]

Bloo Loo, on 09 February 2010 - 09:11 AM, said:

lending isnt the problem.

the system is awash with money....an extra 200bn at the very least. and velocity has slowed...so the banks have tons of it.

Its borrowers they are short of.

so what do sellers do to move stock? they sell more cheaply...for lenders this means selling to more risky borrowers at a price that doesnt cover the risk....before 2007, they could sell this on packaged as MBS to be repackaged as Bonds with better returns than guilts, and NO RISK ( so they told everyone)

selling more cheaply led to A> bonuses and B> the unpayable debts and the credit crisis.

If the grapevine is true, then I see a problem.

There is no problem .. there is now an MBS buyer .. its the BoE hrough the SLS ..,. any bets on whether SLS will be extended after 2014 ? I dont see any options

[Bloo Loo]

moneyfornothing, on 09 February 2010 - 09:16 AM, said:

There is no problem .. there is now an MBS buyer .. its the BoE hrough the SLS ..,. any bets on whether SLS will be extended after 2014 ? I dont see any options

thats true, but I thought they were to buy only impaired assets....unless these new ones will be impaired by default.

and I note that when QE was announced, the BoE was also to buy 50bn in private bonds....could be the SLS you are refering to, I forget all the acronyms for scheme after scheme TBH (tee hee), but I think the public perception was that these private or corporate bonds would have been in companies needing cash to make things, eg, Ford, BAE, or some other British Manufacturer.

to buy mortgage debt in this way would not only just be a further prop to the property market ( expected) but a con of the first order.

[moneyfornothing]

Bloo Loo, on 09 February 2010 - 09:24 AM, said:

thats true, but I thought they were to buy only impaired assets....unless these new ones will be impaired by default.

and I note that when QE was announced, the BoE was also to buy 50bn in private bonds....could be the SLS you are refering to, I forget all the acronyms for scheme after scheme TBH (tee hee), but I think the public perception was that these private or corporate bonds would have been in companies needing cash to make things, eg, Ford, BAE, or some other British Manufacturer.

to buy mortgage debt in this way would not only just be a further prop to the property market ( expected) but a con of the first order.

We should be used to this by now .. there is no trick left to be tried in propping up the property bubble .. Its a shame ..


Though for some reason the SLS does not buy impaired assets but they can buy Asset backed securitiess including credit card debts rated AAA by at least two of the ratings agencies .. thats alright then !! How credit card debt can be an asset backed security beats me but there you go .. its all more money for the bankers .. The banks better have a cushy job lined up for GB after all this trouble he took for them..

[Alan B'Stard MP]

moneyfornothing, on 09 February 2010 - 09:16 AM, said:

There is no problem .. there is now an MBS buyer .. its the BoE hrough the SLS ..,. any bets on whether SLS will be extended after 2014 ? I dont see any options

I believe the SLS is closed for new lodgements.

[Money Spinner]

I saw a graph illustrating where people should put their money in. Every 20 years or so, it was a cycle of hard assets or paper assets that outperformed. From the year 2000, we are in a secular bull market of hard assets.

Perhaps they were right - property is a hard asset.

This isn't the same chart - but in each of the red block years, hard assets do OK.

[Bloo Loo]

Alan B said:

I believe the SLS is closed for new lodgements.

Lodgements....theres a word that is self explanatory, has a nice sound, and Ive never heard before.

thanks.

[interestrateripoff]

Offering a 95% mortgage is very different to actually authorising the loan.

You go in and apply for it only to be told you don't meet the criteria very sorry old chap, but we do have another more expensive option for you. Would you like to apply for that.

Is this more of a sign the bank paying lip service to it's promise to lend?

[catmandu]

It's probably just one of the mortgages we've heard lots about recently - 95%, but requires parents to guarantee a further 20% or some variant whereby the offer is not quite as generous as it seems.
If it is a straight 95% then it would of course be bad news (for the banks and the borrowers! )