UK Money News
6th May 2008
Larger deposits required for best-buy mortgage loans
Lenders are restricting access to the best buy mortgage deals to those with substantial deposits, new research has shown.
The trend towards lenders raising maximum loan to values (LTV) on products was uncovered by online mortgage company mform.co.uk.
According to the company, the LTV average on the top ten best buys in May stands at 85 per cent on two year fixed rate mortgages.
By way of contrast, 12 months ago the average was 85 per cent on two year fixed rate loans.
Francis Ghiloni, mform.co.uk's business development director, said: "The credit crunch has not only seen mortgage rates and fees rise, it has also resulted in many lenders reducing their maximum LTVs.
"All aspects of the mortgage market have been affected and it has never been more important for people to search for the best deal for them than now."
Mform calculates that the average sum required to secure a best buy loan on a property worth £185,000 has risen from £16,650 to £22,940.
This follows a rise in the average LTV on such products from 91 per cent to 87.6 per cent in the last year.
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