Last week the death knell rang for the 125% LTV mortgage, as Coventry, Northern Rock, Alliance & Leicester and BM Solutions pulled their deals. The withdrawals are bad news for first-time buyers who are now likely to have an even tougher time getting on the property ladder. So, this week Mortgage Strategy asks…
Will the end of high LTV deals affect your ability to buy or remortgage?
Nick Goose, 37, academic
I have a 125% LTV mortgage but knew this day might be coming, so I’ve put money aside in case of negative equity. The withdrawal shouldn’t affect my ability to remortgage but only because of the cash I’ve saved.
Kuniji Matsukawa, 60, retired caterer
My daughter is a first-time buyer and she is looking to buy property in London this year. But she wouldn’t be stupid enough to take out a 125% LTV mortgage, so it won’t delay her attempts to get on the ladder. I think she will wait to finance it properly.
Julian Smallwood, 40, advertising consultant
It’s not going to affect my attempts to get on the ladder because I already own a house abroad. But I think high LTV deals should be available as long as there are appropriate penalties in place in case of default.
Sarah Musk, 24, actress
It’s going to delay me. My partner and I plan to buy our first property in about three years’ time and are saving for a deposit. But we’re still going to need a 125% LTV mortgage deal, otherwise we’re going to find it a struggle.
Claudia Hernandez, 26, writer
I’m not looking to buy a property for a few years and by that stage I hope to have a stable job and be able to put down a substantial deposit. So hopefully the lack of high LTV deals won’t affect me.
Ben Oliver, 25, journalist
I think the lack of high LTV deals will probably delay my attempts to get on the housing ladder. That extra 25% loan would have helped me cover the associated costs, such as furniture, fittings and any DIY I might want to do.