Two-thirds of mortgage deals still require deposit of 25%
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by Kay Mitchell
Despite reports claiming that lending has increased to borrowers, large deposits are still required for over two-thirds of mortgage deals on offer.
A recent report by price comparison website, Moneyfacts, found that 68% of the 1,485 mortgage deals on offer still demand a deposit of at least 25%.
In the last month, the number of mortgage deals on offer has seen a marginal increase from 1,398 to 1,485.
Meanwhile, Moneyfacts points out that the number of mortgages available at 90% of the value of a home has fallen. At the beginning of March, there were 101 such deals available but this is down to 93 currently. However, deals with a loan-to-value of 85% are up by 21 to 258 in the same period.
However, the good news comes as the Royal Bank of Scotland and Lloyds Banking Group are set to increase loans to homeowners, in exchange for signing up to the Government’s Asset Protection Scheme.
In related news, recent reports have suggested that we may be starting to see a recovery in the housing market after the Bank of England announced recently that the number of mortgages approved grew to 38,000 in February, up 6,000 compared with January.
Many said the rise was an indication that activity in the housing market may be starting to bottom out.
However, many have since cautioned that the market has a long way to go before it resumes to “normal” levels.
Furthermore, today, the Royal Institution of Chartered Surveyors (Rics) warned that it would be ‘premature’ to assume that house prices are on the road to recovery after figures from the Halifax house price index showed an average house price fall of 1.9% during the month of March.
However, in stark contrast, the Nationwide Building Society reported that house prices increased by 0.9% in March.
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