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HTML <html> <head> <title>Could this be the end for 125% mortgage loans?</title> </head> <body> <h1>Could this be the end for 125% mortgage loans?</h1> <div class="info">Author: <a href="author_1_99670.html">Justin Schamotta</a></div><div class="body">Over the past couple of weeks a number of lenders have announced that they will no longer be offering mortgage loans of 125%, reflecting the continuing impact of the global credit crunch that has already resulted in tighter lending conditions across the UK. In the pasts 125% mortgages have proven popular amongst first time buyers who have taken these mortgage loans to raise the money to purchase a property and have used the extra cash for things such as renovation or home improvements. Paying stamp duty and legal fees, or furnishing their new home.<br /> <br /> A number of well known lenders have now announced that they will no longer offer these super-size mortgages, with the Abbey, the Alliance & Leicester, and more recently Northern Rock, all taking their 125% mortgage products off the shelves. Although these loans have received criticism in the past for sinking people in to deep levels of debt very quickly, this decision to remove these loans from the market could spell bad news for financial strapped first time buyers and those on low incomes or with no savings.<br /> <br /> The withdrawals of these 125% mortgages could make things even more difficult for many first time buyers, taking away their ability to get onto the property ladder due to high property prices, crippling additional costs, and no equity from any previous property to help them with their purchase. <br /> <br /> With these mortgage loans 95% of the loan covers the actual mortgage and the other 30% is offered as an unsecured loan. This means that those currently on these deals who need to remortgage may only be able to refinance the mortgage part of the loan, and may experience further difficulties because they will be classed as having a huge unsecured debt into the bargain. <br /> <br /> With the global credit crunch causing chaos in the financial markets, it is likely that an increasing number of lenders will follow suit in taking these mortgages off the shelves. Many lenders have also stopped offering 100% mortgage loans – only one in ten lenders now offer 100% mortgages whereas at the end of last year around one third of lenders offered them. <br /> </div> <div class="source">Article Source: <a href="http://www.articlealley.com/article_484687_19.html">http://www.articlealley.com/article_484687_19.html</a></div> <div class="author"> <div class="authorBio">Justin Schamotta is a staff writer for the credit card news and price comparison site Credit Card Comparison Online. </div> <div class="authorUrl"><a href="http://www.credit-card-comparison-online.co.uk" target="_blank">http://www.credit-card-comparison-online.co.uk</a></div></author> </body> </html>
Text Could this be the end for 125% mortgage loans? Author: Justin Schamotta Over the past couple of weeks a number of lenders have announced that they will no longer be offering mortgage loans of 125%, reflecting the continuing impact of the global credit crunch that has already resulted in tighter lending conditions across the UK. In the pasts 125% mortgages have proven popular amongst first time buyers who have taken these mortgage loans to raise the money to purchase a property and have used the extra cash for things such as renovation or home improvements. Paying stamp duty and legal fees, or furnishing their new home. A number of well known lenders have now announced that they will no longer offer these super-size mortgages, with the Abbey, the Alliance & Leicester, and more recently Northern Rock, all taking their 125% mortgage products off the shelves. Although these loans have received criticism in the past for sinking people in to deep levels of debt very quickly, this decision to remove these loans from the market could spell bad news for financial strapped first time buyers and those on low incomes or with no savings. The withdrawals of these 125% mortgages could make things even more difficult for many first time buyers, taking away their ability to get onto the property ladder due to high property prices, crippling additional costs, and no equity from any previous property to help them with their purchase. With these mortgage loans 95% of the loan covers the actual mortgage and the other 30% is offered as an unsecured loan. This means that those currently on these deals who need to remortgage may only be able to refinance the mortgage part of the loan, and may experience further difficulties because they will be classed as having a huge unsecured debt into the bargain. With the global credit crunch causing chaos in the financial markets, it is likely that an increasing number of lenders will follow suit in taking these mortgages off the shelves. Many lenders have also stopped offering 100% mortgage loans – only one in ten lenders now offer 100% mortgages whereas at the end of last year around one third of lenders offered them. Article Source: http://www.articlealley.com/article_484687_19.html About the Author: Justin Schamotta is a staff writer for the credit card news and price comparison site Credit Card Comparison Online. http://www.credit-card-comparison-online.co.uk
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