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Mortgages Made Easier To Get

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http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/8362209/Mortgages-made-easier-to-get.html

The mortgage market is enjoying a whiff of spring, following a raft of new measures designed to make home ownership easier and safer.

A growing list of lenders will now advance mortgages to "high risk" borrowers, while some types of mortgage insurances, which died out completely during the recession, are making a comeback.

Northern Rock has become the latest lender to launch a loan aimed at borrowers with only a 10pc deposit. Classed as "high risk", these customers were all but abandoned during the credit crunch.

The Rock's move has set property pulses racing, even if the deals are hardly adrenalin-pumpers. It marks a significant mortgage market milestone, if the bank, pilloried for being the most reckless lender, has repaired its reputation and regained confidence sufficiently to grant larger loans again.

Elsewhere, the reappearance of companies prepared to underwrite redundancy insurance is a further welcome sign that confidence is returning and that the worst could be behind us. Indeed, so good has been the claims experience at Yorkshire Building Society over the last year, that it has reduced its premiums across the board.

Couldn't see this joyous news anywhere.

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And yet they still don't want to acknowledge why 90% ltv mortgages are 'high risk'.

Why, whats that large grey land mammal standing in the corner of the room eating all our buns?

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And yet they still don't want to acknowledge why 90% ltv mortgages are 'high risk'.

Why, whats that large grey land mammal standing in the corner of the room eating all our buns?

nothing wrong with a lender lending 90, 100, 200% LTV.

The risk is not in the LTV...thats for investors and regulators to limit loans....the risk is in the ABILITY TO REPAY.

with current prices, and average earnings stagnant and falling with redundancies, then yer average worker cant afford to repay 90%, 80%..50% over a 25 year scenario at a suitable interest rate to cover the risk.

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nothing wrong with a lender lending 90, 100, 200% LTV.

The risk is not in the LTV...thats for investors and regulators to limit loans....the risk is in the ABILITY TO REPAY.

with current prices, and average earnings stagnant and falling with redundancies, then yer average worker cant afford to repay 90%, 80%..50% over a 25 year scenario at a suitable interest rate to cover the risk.

But people's ability to repay can change overnight, and then the negative equity translates into losses for the banks tax payers.

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nothing wrong with a lender lending 90, 100, 200% LTV.

The risk is not in the LTV...thats for investors and regulators to limit loans....the risk is in the ABILITY TO REPAY.

with current prices, and average earnings stagnant and falling with redundancies, then yer average worker cant afford to repay 90%, 80%..50% over a 25 year scenario at a suitable interest rate to cover the risk.

I agree that CURRENT ability to pay is an important factor. But that doesn't do much good when that ability is lost to unforseen circumstances (eg redundancy) hence pricing in

collateral, or lack of, into interest rates.

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nothing wrong with a lender lending 90, 100, 200% LTV.

The risk is not in the LTV...thats for investors and regulators to limit loans....the risk is in the ABILITY TO REPAY.

with current prices, and average earnings stagnant and falling with redundancies, then yer average worker cant afford to repay 90%, 80%..50% over a 25 year scenario at a suitable interest rate to cover the risk.

Exactly, "Oh but I have got 20% deposit, the mortgage I require is £200k but my pay slip says I earn £30K per year, my wife is not working and we have a baby on the way." :o

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2 Year Everyday Fixed

5.99% fixed until 1 Jun 2013

followed by our Standard Variable Rate, currently

4.79%

overall cost for comparison is

4.9% APR

£0 Product fee

Monthly payments will appear here

4% early repayment charge until 01 Jun 2013

90% Max loan to value

The fact there's no fee is interesting. "can't afford to buy a house, we'll help you waste taxpayers money"

* Refer to scale for Valuation Fee payable

* Daily Interest

* Can apply for Payment Holidays

* Early Repayment Charge of 4% applied to the outstanding secured balance within the Incentive Period, payable on Full Redemption only

* No Higher Lending charge

* Limited overpayments - up to 10% of outstanding balance each calendar year.

* No Product Fee

I think the payment holidays has always been a dodgy idea too.

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But people's ability to repay can change overnight, and then the negative equity translates into losses for the banks tax payers.

Of course, that is correct, but it was a matter of policy to make the tax payers take the hit

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2 Year Everyday Fixed

5.99% fixed until 1 Jun 2013

followed by our Standard Variable Rate, currently

4.79%

overall cost for comparison is

4.9% APR

£0 Product fee

Monthly payments will appear here

4% early repayment charge until 01 Jun 2013

90% Max loan to value

The fact there's no fee is interesting. "can't afford to buy a house, we'll help you waste taxpayers money"

* Refer to scale for Valuation Fee payable

* Daily Interest

* Can apply for Payment Holidays

* Early Repayment Charge of 4% applied to the outstanding secured balance within the Incentive Period, payable on Full Redemption only

* No Higher Lending charge

* Limited overpayments - up to 10% of outstanding balance each calendar year.

* No Product Fee

I think the payment holidays has always been a dodgy idea too.

payment holidays are great when you want to sell your dodgy loan book to the Government guarantee....NR used this....claiming that many in default were just taking 3 months off.

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A relative looking to move from a 3-bed to a 4-bed (extra £250K!) has discovered his base+0.7% lifetime offset deal allows further funds to be borrowed (subject to income/LTV limits).

He had offsetted the full amount of the existing mortgage (=>zero net debt) so can now borrow £200K at £1.2%.

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http://companyinfo.northernrock.co.uk/corporateCommunications/news/article.asp?newsID=385

</h2>

<h2 style="border-bottom: 1px solid rgb(216, 234, 245); margin: 1em -20px 1em 0px; padding: 0px 10px 0.3em 0px; color: rgb(0, 51, 102); font-weight: bold; font-size: 1.4em; text-transform: lowercase;">northern rock launches new 90% ltv mortgages to help first time buyers
  • Everyday Fixed Rate mortgages up to 90% LTV available from 5.99% with no product fee payable
  • Part of a new package of support for First Time Buyers with good affordability
  • Everyday rates cut across the rest of Northern Rock's mortgage range

As part of its new support package for First Time Buyers, Northern Rock has today introduced a new range of Everyday mortgages with competitive interest rates available up to a maximum of 90% LTV.

Designed to appeal to those who have lower deposits but with good affordability, including First Time Buyers, a 2-Year Fixed Rate deal is available at 5.99%, a 3-Year Fixed Rate is 6.49% and a 5-Year Fixed Rate is 6.59%. No product fees are payable on any of the products, all of which are being offered directly through Northern Rock branches and UK call centre, as well as being available through some of the bank's intermediary partners.

In addition to these new products, Northern Rock has also cut interest rates across the rest of its mortgage range, with Everyday Fixed rates for customers with deposits of 25% and 30% reduced by up to 0.19%, Everyday Trackers for those with deposits of 25% and 30% have been reduced by up to 0.30%, 2-Year Fixed rate Buy-to-Let (BTL) deals cut by 0.60%, and longer term BTL deals by 0.20%.

With First Time Buyers in mind, the new 90% LTV mortgages will be complemented by a new service proposition, to help customers take their first steps onto the property ladder.

Research carried out by the bank revealed that while First Time Buyers are excited at the prospect of owning their own home, they felt the process could be daunting and confusing, with little support available in the market to meet their specific needs.

Northern Rock has therefore designed a full delivery service for First Time Buyers, developed specifically to ease these concerns and guide customers through their first experience of buying a home.

Andy Tate, Northern Rock's Customer and Commercial Director, said: "Our new products, which will be offered within our prudent risk appetite and only to customers with good affordability, should appeal to those who have lower deposits and First Time Buyers.

"First Time Buyers are important to the housing market. Having listened to those customers, we have developed a service that not only helps them to arrange the right type of mortgage that they can afford, but also supports them through the various steps in the process."

Northern Rock will help steer customers through the house-buying process using ten simple steps, each of which covers a different area of the house purchase journey, from setting an affordable budget at the outset, right through to exchange and completion. Experienced advisers will also be on hand both on the phone and in branch to answer any queries.

A new animated video guide for First Time Buyers has already been added to our award-winning mortgage website to help customers with their initial research. The website also contains a whole host of other useful tools, such as a budget planner, and a mortgage calculator.

Customers can arrange to do everything under one roof, from organising a survey to choosing a solicitor from our approved panel, and even selecting insurance most appropriate to their needs.

For more information about what we are able to offer First Time Buyers, please visitwww.northernrock.co.uk/mortgages.

They're all heart.

Looks like Grantley Chapps is getting his innovation. They've decided to use NR to lower the lending criteria, kickstart the competition and try and put a floor under prices. I'd suggest we're probably now around the '93/94 sort of timeline with another 5-10% going to come from nominal falls overall and the rest via 3-4% p.a. real falls over several years.

It's back to the future.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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