When are going back to 10% or even 5% deposits

GGB

Thrugelmir wrote: »

Demonstrates that the borrower has the ability to manage their money in a responsible manner. Regular saving creates a discipline .

But does it?

It shows that someone can discipline themselves for a set time frame to reach a goal, saving for a deposit is not a regular activity for most people.

I'd say that making your payments on time, not stretching yourself with debt and not taking on debt to cover short term purchases (i.e. holidays or normal day to day expenditure) shows a greater ability to manage money.

Of course a buyer should put down a deposit of some description for a house purchase, but even a balance of 5% coupled with a good financial history imo should be sufficient.

Ste.._2

I agree, what's more important is whether or not they are able to pay their rent and bills each month. A mortgage simply takes the place of the rent, and most people cannot save very much very quickly whilst having to pay rent and live their lives.

In normal credit conditions, which sadly we are not in, 5% and 10% deposits for FTBers are perfectly acceptable.

m00m00

Nottingham Building Society were offering a 95% deal recently (may still be doing, haven't checked) with a strict 3.5x salary multiplier

5-10% deals are fine, with sensible low multipliers

spadoosh

Were in the middle of applying for a 10%deposit, just waiting back on valuers. We were aloud to go with a 5% deposit and 5% vendor gifted which would be even better for some

Thrugelmir

GGB wrote: »

saving for a deposit is not a regular activity for most people.

Therein lies another problem. Lenders will require retail deposits to help fund mortgage lending in the future. As it takes those saving for a deposit to fund another borrowers mortgage.

There isn't the availability of funding to support a high LTV culture. What funding there will be at 85% plus levels will not be at cheap rates of interest. Due the capital reserve requirements that lenders are required to adhere to now.

So people wishing to obtain a mortgage will have a choice to make.

Conrad

GGB wrote: »

5% coupled with a good financial history imo should be sufficient.

In your research did you delve into the corporate balance sheets in reaching your opinion? So for example RBS and Halifax have billions in toxic debt on thier balance sheets - did your findings take into account the incomming new fundsa required to pay that off and satisfy the regulators and the Banks shareholders, lenders and insurers?

Did you also taked into account the need for savers to have the surity that comes with a well capitalised institution?

m00m00

The Nottingham 95% deal is still available
6.39% for 3 or 5 years fixed, 195 fee, free valuation
3.75 multipliers

only available in branch, for specific postcodes (no idea what these are, but will almost certainly require NG, or LE at the start)

GGB

Conrad wrote: »

In your research did you delve into the corporate balance sheets in reaching your opinion? So for example RBS and Halifax have billions in toxic debt on thier balance sheets - did your findings take into account the incomming new fundsa required to pay that off and satisfy the regulators and the Banks shareholders, lenders and insurers?

Did you also taked into account the need for savers to have the surity that comes with a well capitalised institution?

And of course all of this toxic debt etc came about due to a maximum LTV of 95% and a good financial history required on all applicants?

Thrugelmir

GGB wrote: »

And of course all of this toxic debt etc came about due to a maximum LTV of 95%

Don't confuse the toxic debt issue with poor quality mortgage lending in the UK.

krisswilliams

Ive just recently got a 90% LTV mortgage with Natwest fixed for 2 years, rates are high but we can afford it and are now on 'the ladder'...