125% mortgages // just when we thought it was safe

Gorgeous_George

I don't like the abbreviation 'NE'. I use that for the wonderful North East where negative equity is minimal.

GG

HAMISH_MCTAVISH

As I recall, in the last recession/crash, some lenders did allow NE porting once it was clear the bottom had been reached, or close to it, and so this announcement now is no surprise given all the big banks, and the CEBR, etc, now predict we are within 6% to 8% of the absolute trough..

I'd expect we may see less of it this time around though as the causes of the crash and effects on the financial system are radically different this time to last as well. The banks don't have the money to lend a lot at 90% LTV yet, let alone 125% LTV. Which is why the market crashed to begin with.

As it stands, it's probably having a big constraint on supply at the moment, but only because the lending limits re LTV are so tight. If the limits were looser, then more poeple in NE could move. But if the lending limits were looser, then prices would skyrocket anyway, meaning nobody would be in NE to begin with.