New mortgage deposit

Competsoph

HSBC are indeed offering 10% LTV. Broker deals are the same as going direct at present. 

grumiofoundation

Douve87 said:

Socajam said:

Nationwide triples minimum deposit for UK first-time buyers

Mortgage lender sets 15% level to help protect customers from negative equity

I think this is going to be the norm

I agree that i think this will be the new norm but it is rubbish that it is to protect customers. Putting a bigger deposit down doesn't protect the customer but the lender as they have first charge on the property so there is more wriggle room to ensure they get their money back if property prices drop. I understand why banks are doing it but it annoys me when they claim its for the customers protection just be honest. A prudent bank is not a bad thing.

But it does protect a buyer from negative equity.

Douve87

AdrianC said:

Douve87 said:
Putting a bigger deposit down doesn't protect the customer but the lender as they have first charge on the property so there is more wriggle room to ensure they get their money back if property prices drop.

Umm, I think you're forgetting that any shortfall is still a debt for the borrower.

You can't just walk away from a place in negative equity and wash your hands of that debt.

What i was meaning is it doesn't protect the customer as in this scenario the customer loses regardless. Ok the customer may not end up owing as much or anything additional but potentially loses all of his deposit and so the customer is back to square one. The removal of 90% ltv is first and foremost for the protection of the bank. Like i said i understand why and theres nothing wrong with the bank being prudent but when they make out its purely for the protection of the customer its annoying. 

Douve87

grumiofoundation said:

Douve87 said:

Socajam said:

Nationwide triples minimum deposit for UK first-time buyers

Mortgage lender sets 15% level to help protect customers from negative equity

I think this is going to be the norm

I agree that i think this will be the new norm but it is rubbish that it is to protect customers. Putting a bigger deposit down doesn't protect the customer but the lender as they have first charge on the property so there is more wriggle room to ensure they get their money back if property prices drop. I understand why banks are doing it but it annoys me when they claim its for the customers protection just be honest. A prudent bank is not a bad thing.

But it does protect a buyer from negative equity.

I don't mean to split hairs but it doesn't protect the customer from.negative equity as nothing will. Having a 15% deposit will still mean going into negative equity if prices drop 20%. I recognise it means the customer only owes 5% as opposed to 10% in such a scenario. I also recognise every financial decision is a risk but my point is the customer loses regardless either they lose all their deposit and they still owe the bank or they lose all their deposit (so lose lose). Removing 90% products is first and foremost for the benefit of the lender and to limit their risk. As mentioned ive no problem with banks being prudent but dont make out its purely for the customers benefit.

grumiofoundation

Douve87 said:

grumiofoundation said:

Douve87 said:

Socajam said:

Nationwide triples minimum deposit for UK first-time buyers

Mortgage lender sets 15% level to help protect customers from negative equity

I think this is going to be the norm

I agree that i think this will be the new norm but it is rubbish that it is to protect customers. Putting a bigger deposit down doesn't protect the customer but the lender as they have first charge on the property so there is more wriggle room to ensure they get their money back if property prices drop. I understand why banks are doing it but it annoys me when they claim its for the customers protection just be honest. A prudent bank is not a bad thing.

But it does protect a buyer from negative equity.

I don't mean to split hairs but it doesn't protect the customer from.negative equity as nothing will. Having a 15% deposit will still mean going into negative equity if prices drop 20%. I recognise it means the customer only owes 5% as opposed to 10% in such a scenario. I also recognise every financial decision is a risk but my point is the customer loses regardless either they lose all their deposit and they still owe the bank or they lose all their deposit (so lose lose).What does that mean? Removing 90% products is first and foremost for the benefit of the lender and to limit their risk. As mentioned ive no problem with banks being prudent but dont make out its purely for the customers benefit.

Since you want to split hairs - it will protect buyers with a 5% deposit from negative equity by removing the opportunity from them to go into negative equity. In the same way you can protect someone from breaking their leg by going skiing by not allowing them to go skiing. 

Buyers with a 15% deposit are not being protected from negative equity because the chance of a >15% drop in house prices is predicted as unlikely whereas >5% is obviously much more possible. 

Douve87

grumiofoundation said:

Douve87 said:

grumiofoundation said:

Douve87 said:

Socajam said:

Nationwide triples minimum deposit for UK first-time buyers

Mortgage lender sets 15% level to help protect customers from negative equity

I think this is going to be the norm

I agree that i think this will be the new norm but it is rubbish that it is to protect customers. Putting a bigger deposit down doesn't protect the customer but the lender as they have first charge on the property so there is more wriggle room to ensure they get their money back if property prices drop. I understand why banks are doing it but it annoys me when they claim its for the customers protection just be honest. A prudent bank is not a bad thing.

But it does protect a buyer from negative equity.

I don't mean to split hairs but it doesn't protect the customer from.negative equity as nothing will. Having a 15% deposit will still mean going into negative equity if prices drop 20%. I recognise it means the customer only owes 5% as opposed to 10% in such a scenario. I also recognise every financial decision is a risk but my point is the customer loses regardless either they lose all their deposit and they still owe the bank or they lose all their deposit (so lose lose).What does that mean? Removing 90% products is first and foremost for the benefit of the lender and to limit their risk. As mentioned ive no problem with banks being prudent but dont make out its purely for the customers benefit.

Since you want to split hairs - it will protect buyers with a 5% deposit from negative equity by removing the opportunity from them to go into negative equity. In the same way you can protect someone from breaking their leg by going skiing by not allowing them to go skiing. 

Buyers with a 15% deposit are not being protected from negative equity because the chance of a >15% drop in house prices is predicted as unlikely whereas >5% is obviously much more possible. 

I was talking about the removal of 90%ltv products and still stand that removing them is first and foremost to better insulate the lender from losing money and not about the protection of the customer. Im not saying it wont stop some customers going into negative equity but just because they havent gone into negative equity doesnt mean they haven't lost and so are not protected. Again nothing is risk free especially financial transactions but this action protects the bank first and foremost.

Crashy_Time

Douve87 said:

grumiofoundation said:

Douve87 said:

Socajam said:

Nationwide triples minimum deposit for UK first-time buyers

Mortgage lender sets 15% level to help protect customers from negative equity

I think this is going to be the norm

I agree that i think this will be the new norm but it is rubbish that it is to protect customers. Putting a bigger deposit down doesn't protect the customer but the lender as they have first charge on the property so there is more wriggle room to ensure they get their money back if property prices drop. I understand why banks are doing it but it annoys me when they claim its for the customers protection just be honest. A prudent bank is not a bad thing.

But it does protect a buyer from negative equity.

I don't mean to split hairs but it doesn't protect the customer from.negative equity as nothing will. Having a 15% deposit will still mean going into negative equity if prices drop 20%. I recognise it means the customer only owes 5% as opposed to 10% in such a scenario. I also recognise every financial decision is a risk but my point is the customer loses regardless either they lose all their deposit and they still owe the bank or they lose all their deposit (so lose lose). Removing 90% products is first and foremost for the benefit of the lender and to limit their risk. As mentioned ive no problem with banks being prudent but dont make out its purely for the customers benefit.

Having 90% and 100% loans in the first place is for the benefit of the lender, so they can lend more to people who can`t afford a decent deposit and bump the prices up so the next borrower has to borrow more -  rinse and repeat etc. etc., so what difference does it make, why change a winning sales tactic now? People were told that if they borrowed big they benefited by "getting on the ladder", now they are being told that if they save up more deposit and borrow less they benefit from "not getting stuck in negative equity", it is up to people themselves to negotiate discounts and to borrow within their means IMO. They say that in China now many small businesses don`t want the cheap loans being offered, and this is a problem for the overall debt bubble, it always amazes me how sections of the UK public will just borrow as much as they can every time for basic shelter, new-builds etc.

onthemend88

Crashy_Time said:

it always amazes me how sections of the UK public will just borrow as much as they can every time for basic shelter, new-builds etc.

Because everyone's circumstances are different?  

caw379

Calamityjen said:

I secured a mortgage with HSBC on a fixed rate of 2.04% on 3rd June and I am using a 10% deposit, I went with a mortgage broker however but I think you should be able to go to HSBC direct.  I am a first time buyer and had an IVA in 2012, i had very little hope of ever getting a mortgage, but I worked hard and am hopefully going to be a first time buyer. Best of luck 

Hi @C@Calamityjen hope you dont mind me asking, but did you start your IVA in 2012 or did you finish it in 2012?