Tuesday, Jul 22, 2008
Credit crunch abating?
Ft Adviser: Nexcastle BS considers return to 95% mortgage market
Newcastle Building Society said discussions had taken place recently about offering a new product up to 95 per cent LTV for house purchase and remortgaging. Their current maximum LTV is 85%.
The news followed last weeks announcement by Scarborough BS that it was launching a two-year fixed rate 95 per cent LTV product that would be available through its nine branches.
However other lenders, including Yorkshire Building Society, Bank of Ireland, C&G, Woolwich and Co-op have all said they are not re-entering the 95% market anytime soon.
Halifax, Nationwide and Abbey still offer 95% mortgages, but have no plans to expand their ranges.
Posted by little professor @ 12:51 PM (619 views) Add Comment
10 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. waitingfor hpc said...
more like the next northern rock in waiting
2. beartil2010 said...
Interesting. I think this is salient:
'Mr Marks said by offering such products through regional distribution it enabled lenders to identify areas that may not be subject to such large falls in house prices that could affect other parts of the country'
Still deluded I think. I think they could get away with 95% ltv as long as they know the applicant will go into negative equity, they just need to have an awesome credit history and salary cover. Risky. I can see they want to be as successful as HBOS.
And in America Wachovia pulls out of mortgages completely... maybe it will be like that here in 9 months?
3. drewster said...
How does the Newcastle BS plan to fund these 95% LTV mortgages? They won't be able to securitise them so funding will have to come from savers' deposits. If was a saver with them I'd close my account now!
4. mrmickey said...
Drewster that's what I was thinking are they attracting lots of saver by offering really cracking savings rates or something ?
5. harold said...
"Halifax, Nationwide and Abbey still offer 95% mortgages"
But to whom? Barristers?
6. Renting2 said...
Surely the only high LTV (95%) mortgage product that could possibly be viable would be with a fixed/tracker term of 10 years or more. This would allow time for market recovery/inflation to 'repair' the damage. At the present nything with a shorter term (2-3 years) would probably put the client in nequity at the usual remortgage stage so selling it would not be 'treating customers fairly' IMO.
7. jack c said...
Guy's just because lenders have a 95% LTV product in the range doesnt mean to say the applicant will be successful in obtaining it, they use these things as a means of getting people into branches etc and then sell them something else (usually more profitable product) - I bumped into someone I know on Friday who is ex LTSB now at HSBC and I quizzed her on the Fixed rate mortgage matching they had on offer - turns out in the city centre branch in which she works no one who came forward on the rate match took up the product (put off by the fees) - HSBC simply sold a standard product - sprats and makrels as they say.
8. drewster said...
jack c,
Thanks for the insight. The old bait & switch scam!
9. jack c said...
drewster, I'm out at a charity event this weekend with one of the Directors from Newcastle BS if I get anything more worthwhile to add on this topic I'll post it up.
10. new user 2007 said...
The question is what income multiple are we talking about?
In the last year the issue has largely been two factors...a return to normal for deposits AND income multiples. Both were needed for the pyramid scheme.