125% mortgages are back

not_tonight_josephine_2
not_tonight_josephine_2 Posts: 282 Forumite
edited 9 July 2009 at 11:44AM in Mortgages & endowments
http://news.bbc.co.uk/1/hi/business/8141584.stm

How long before others do the same?!

Oops - just noticed someone already got there with this one!
«1

Comments

  • SelbyJay_2
    SelbyJay_2 Posts: 113 Forumite
    Who are the other two lenders "thinking" of offering these deals??
    Mortgage - £37k
    Credit Card (A&L) -[STRIKE] £2300 -[/STRIKE] £1200
    Santander Credit Card - [STRIKE]£1400[/STRIKE] £1100
    [STRIKE]OD - A&L - £1300[/STRIKE] GONE!!!

    "I will be debt free, I will be debt free!"
  • luckyfool
    luckyfool Posts: 1,683 Forumite
    Only they aren't really back are they. It's lenders allowing people who are already in negative equity with them, to transfer to a new property at the same loan to value.
  • dunstonh
    dunstonh Posts: 119,070 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    luckyfool wrote: »
    Only they aren't really back are they. It's lenders allowing people who are already in negative equity with them, to transfer to a new property at the same loan to value.

    Although that was how 125% mortgages started last time round. It was only for those in negative equity. ;)
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • luckyfool
    luckyfool Posts: 1,683 Forumite
    Possibly. I think we are still quite some way off the likes of Nationwide looking at more than 85% for people who are not already customers and exposed at higher ltv limits.
  • robfuzzard
    robfuzzard Posts: 19 Forumite
    What is an ltv limit? Sorry, bit simple.
    You lot make me feel stupid.
  • molerat
    molerat Posts: 34,220 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    robfuzzard wrote: »
    What is an ltv limit? Sorry, bit simple.
    Loan To Value
  • SelbyJay_2
    SelbyJay_2 Posts: 113 Forumite
    If you have a 95% ltv, you are borrowing 95% of the property's value i.e. mortgage of £95k on a £100k property.
    Mortgage - £37k
    Credit Card (A&L) -[STRIKE] £2300 -[/STRIKE] £1200
    Santander Credit Card - [STRIKE]£1400[/STRIKE] £1100
    [STRIKE]OD - A&L - £1300[/STRIKE] GONE!!!

    "I will be debt free, I will be debt free!"
  • Singlemummy_2
    Singlemummy_2 Posts: 113 Forumite
    Part of the Furniture 10 Posts Name Dropper Combo Breaker
    dunstonh wrote: »
    Although that was how 125% mortgages started last time round. It was only for those in negative equity. ;)

    Really? I know of an FTB who got a 120% mortgage on their home!
  • dunstonh
    dunstonh Posts: 119,070 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Singlemummy wrote: »
    Really? I know of an FTB who got a 120% mortgage on their home!

    Yes. Thats where the credit boom failed.

    However, the origins of 125% mortgages started in the mid 1990s to help people who fell into negative equity after the last house price crash.

    They should have been stopped in the early 2000s when most people were out of negative equity but the foolish lenders carried them on and retailed them willy nilly.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Ian_W
    Ian_W Posts: 3,778 Forumite
    Part of the Furniture 1,000 Posts Photogenic
    dunstonh wrote: »
    ... but the foolish lenders carried them on and retailed them willy nilly.
    Which mainstream lenders did 125% mortgages besides Northern Rock?
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