New 2.29% 1 yr fixed rate - Anyone got £80k?!?!

Mike1999

I'm a 27yr old FTB and I saw this new product from Woolwich and it is a great headline rate and I even managed to get my head around it only being 1 year and then reverting to 2.29% over base but...60% LTV on minimum loans of £200,000!!!! Correct me if I'm wrong but that would mean you'd need £80,000 deposit right?

Who the hell has £80k lying around?! Does anyone know when realistic products are going to come out or when it'll ever get back to some sort of level where FTB can actually have an outside chance of getting a house?

I probably don't know enough about all the ins and outs here but just get the feeling I'm going to be mid to late 30's before I ever own a house! :eek:

JayZed

Actually, if the minimum loan is £200,000 you'll need a deposit of £133,333. It's clearly not a product aimed at FTBs.

koexelek

JayZed wrote: »

Actually, if the minimum loan is £200,000 you'll need a deposit of £133,333. It's clearly not a product aimed at FTBs.

unless they happen to be rock stars or footballers

Mike1999

Ah good maths from me there! So who would actually be able to take this mortgage then? Does it literally mean it's only available for those who have a load of cash?

JayZed

I should imagine it's mostly aimed at existing homeowners who have a reasonable amount of equity in their property. There are lots of people who have more than £130K of equity in their property.

sdooley

Could be good for people who own their home outright and want to use it to buy a second home cheap as the market drops. Not popular in Cornwall, I'd imagine.

Mike1999

Ah right. So I guess the property boom has seen those buyers still have a lot of equity depite the current climate because of when they bought their homes.

Do you think it'll ever get back to 90% mortgages and things like that without having to sell body parts on fees etc? If so when do you think?

morg_monster

spot on mike. my parents bought a house for about 175k in 1994 and now it has probably more than quadrupled in value. so any property crash would have to be unimaginable for them to lose out!
i'm in the same boat as you, 27yr old wannabe FTB. just remember the FTB boat is more fun to be on these days than it used to be... even with the tight lending. shame our deposit savings aren't growing like they used to!

betmunch

Steer well clear of that mortgage, its a nasty piece of work.

You get drawn in by the headline rate, then as rates start to increase you will be tied to a terrible tracker at BBR +2.29% for the following two years.

Its a really nasty trick if you ask me, and thats not even taking into account the reason a mortgage advisor would have give for recomending a product that changes from a fix to a tracker during the product period!

I expect the bulk of these will be sold to people that dont take advice.

Just my two pennith!

Cheers