22 Dec 2024

Return of the high LTV Mortgages

There has been an increase in activity from lenders launching mortgage deals at higher loan-to-values (LTVs), providing some much-needed relief for first-time buyers (FTBs) searching for competitive rates for smaller deposits.

There were 36 new mortgage deals in the 85% LTV tiers and above in August 2012, a complete reversal from the drop of 26 products the previous month.

In a breakdown of individual tiers, there were 16 more products in the 85% LTV tier (11 fixed and five variable), 15 in the 90% LTV tier (nine fixed and six variable) and five in the 95% LTV tier, all of which were fixed rate products.

This suggests that lenders are relaxing their attitudes to higher risk lending, perhaps in reaction to the Government’s recently-launched Funding for Lending scheme, which aims to make £80 billion of cheap funding available to banks and building societies on condition that they lend more to small businesses and consumers in the hope that this will kick-start the economy.

However, it appears that building societies are leading the way at offering products targeted at those with smaller deposits, with 10 of the 15 providers which launched 90% plus LTV products being building societies.

Sylvia Waycot, finance expert at Moneyfacts.co.uk, comments:

“Attaining a deposit becomes more realistic if LTVs are raised and so after years of frustration potential FTBs must be doing jigs of joy in the street.

“Increasing LTVs will create a knock-on effect in the whole housing market. Not only will it aid the stagnation of the FTB market, but also the second movers market because they need FTBs to sell to. House buying as we all know is a chain and every link is essential; strengthen one link and the whole chain benefits.”

New High LTV Mortgage Deals

Mortgage Provider	Mortgage Interest Rate	Max LTV	Fee
First Trust Bank (NI)	3.99% Fixed to 31/01/2016	90%	£450,
Hanley Economic BS	4.29% Fixed to 30/11/2014	90%	£900,
Shepshed BS	4.49% discounted for 3 years	90%	£999,
Bath BS	4.89% discounted for 3 years	90%	0.50%
HSBC	4.89% Fixed to 31/12/2014	90%	None
HSBC	4.89% Fixed to 31/12/2015	90%	£599,
HSBC	4.89% Fixed to 31/12/2015	90%	None
HSBC	4.89% Fixed to 31/12/2017	90%	None
HSBC	4.89% Fixed to 31/12/2019	90%	None
Tipton & Coseley BS	4.94% discounted to 31.10.14	90%	0.40%
Furness BS	4.99% discounted for 3 years	90%	£199
Bath BS	4.99% Fixed for 3 years	90%	0.50%
Newcastle BS	5.19% Fixed to 31/10/2014	90%	None
Bath BS	5.29% Fixed for 3 years	95%	0.50%
Coventry BS	5.39% Fixed to 30/09/2017	90%	£499,
Melton Mowbray BS	5.49% Fixed to 31/10/2015	95%	£998,
Clydesdale Bank	5.69% Fixed to 30/11/2015	90%	£999,
Newcastle BS	5.69% Fixed to 31/10/2017	90%	£690,
NatWest Mortgage Services	5.95% Fixed to 31/10/2014	90%	£995,
Royal Bank of Scotland	5.95% Fixed to 31/10/2014	90%	£995,
Shepshed BS	5.99% Fixed for 5 years	95%	£999,
Newcastle BS	5.99% Fixed to 31/10/2017	95%	£690,
Saffron BS	6.49% Fixed to 29/02/2016	95%	£195,
Source Moneyfacts

Moneyfacts Group
Moneyfacts is the UK’s leading independent provider of personal financial information and our data is used and trusted throughout the financial industry.

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Return of the high LTV Mortgages

New High LTV Mortgage Deals