Should borrowers be concerned?
Several lenders have withdrawn higher loan-to-value (LTV) mortgage deals amid a quieter period for the market, according to the latest analysis by price comparison site Moneyfactscompare.co.uk.
Last week, Hanley Economic Building Society pulled its two-year fixed deal at 95% LTV, while Principality Building Society withdrew selected two- and five-year fixed deals for first-time buyers at 95% LTV.
Saffron Building Society also removed a five-year fixed deal at 90% LTV, and Vernon Building Society withdrew a couple of five-year fixed deals at both 90% and 95% LTV.
Since May 23, the number of fixed mortgage deals at 90% LTV has decreased from 700 to 696, and the number of fixed deals at 95% LTV has dropped from 329 to 326.
Rachel Springall (pictured), finance expert at Moneyfactscompare.co.uk, noted that while the withdrawal of some higher LTV products might raise concerns, it does not indicate a widespread trend.
“Should more deals be withdrawn at higher loan-to-values, it may come as disappointing news to those who have a limited deposit, such as first-time buyers,” Springall said. “The deals that have disappeared last week may well resurface, perhaps when repricing activity picks up in the coming weeks.
“Affordable housing is very much in short supply. There need to be significant changes to turn this around, but borrowers will have to wait and see what might be announced to address this issue after the general election.
“In the meantime, any borrower looking for a new deal would be wise to seek independent financial advice to find the best mortgage that suits their circumstances, such as one with a bundle of incentives providing the best overall value for money.”
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