Friday, February 22, 2008

There are now no lenders offering a combined mortgage and unsecured loan range with the potential value of up to 125 per cent LTV

BM Solutions last lender to quit 125% arena

BM Solutions has confirmed it will be withdrawing its Mortgage Plus product after every other lender in the 125 per cent loan to value market pulled out this week. This comes after Alliance & Leicester, Abbey, Coventry Building Society and its subsidiary Godiva Mortgages all announced their withdrawal from the market on Tuesday. Northern Rock was quick to follow with confirmation yesterday that it would be withdrawing its Together range from the end of play.

Posted by jack c @ 01:35 PM (580 views)
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4 thoughts on “There are now no lenders offering a combined mortgage and unsecured loan range with the potential value of up to 125 per cent LTV

  • In years to come, economics commentators will look back and say “125% mortgages?! What the hell were we thinking?”

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  • I can think of a valid reason to take out a 125% mortgage. Let’s say you buy a £100k house in need of renovation. You could spend the extra £25k doing it up, and assuming you haven’t botched things completely, it should be worth £125k afterwards. So your new LTV is 100% again, not 125%. If you believe Kirsty and Phil, it might even be worth more than £125k. If the market is falling however, then even that post-hoc 100% LTV mortgage looks risky, hence the banks have to withdraw the 125% products.

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  • So that’s it then. The Death Knell for BTLs has sounded. Repos hit the roof. Re-mortgaging all but disappears. Negative Equity Rules. House Prices Crash. Construction turns to Demolition and best of all : EAs are detained under the Mental Health Act.
    Just a thought !!!

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  • Sold My Soul To The Never Never Never says:

    Drewster – regarding your comments – The property we purchased in 1989 we roughly spent around 30K on renovations (it was a real dump) and it was only valued at 10K more 9 years later. We bought it for too much in the first place!

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