x
By using this website, you agree to our use of cookies to enhance your experience.
CORONAVIRUS UPDATE

See the latest Coronavirus statistics from across the world on our world map SEE MAP UK Confirmed cases: 276,332 | UK Deaths: 39,045 SEE MAP Italy Confirmed cases: 233,197 | Italy Deaths: 33,475 | Italy Recovered: 158,355 SEE MAP Spain Confirmed cases: 239,638 | Spain Deaths: 27,127 | Spain Recovered: 150,376 SEE MAP See the latest Coronavirus statistics from across the world on our world map SEE MAP UK Confirmed cases: 276,332 | UK Deaths: 39,045 SEE MAP Italy Confirmed cases: 233,197 | Italy Deaths: 33,475 | Italy Recovered: 158,355 SEE MAP Spain Confirmed cases: 239,638 | Spain Deaths: 27,127 | Spain Recovered: 150,376 SEE MAP

TODAY'S OTHER NEWS

Help to Buy 2 drives high-LTV lending

The Help to Buy mortgage guarantee scheme has boosted both first-time buyer lending and higher-LTV mortgages, new figures show.

The number of 95% LTV mortgages almost doubled as a proportion of overall activity in the first 18 months of Help to Buy 2.

They accounted for £3.43 of every £100 of mortgage, up from £1.77 in the previous 18 months.

First-time buyer lending grew by almost a third during the same period, according to analysis of Bank of England data by Genworth, the private mortgage insurer.

However, the figures also show that first time buyer and 95% LTV lending activity fell year-on-year in Q2 for the second quarter running.

This is the first time this has happened since 2010/11

During the first 18 months of Help to Buy 2, £12.24 of every extra £100 loaned was via 95% LTV mortgages.

This has helped deliver a significant boost to overall lending, without compromising underwriting standards or inflating house prices according to the Financial Policy Committee (FPC).

But there are signs that 95% LTV lending stimulated by Help to Buy 2 may already be on the wane.

Both 95% LTV lending and first time buyer lending declined by value year-on-year across the first half of 2015.

Simon Crone, vice president for mortgage insurance – Europe at Genworth, said:

“There is no denying that Help to Buy 2 has played an important part in revitalising the first-time buyer and high-LTV mortgage market following a significant lending drought.

“Some participating lenders are now moving towards launching non-Help to Buy products, but it remains to be seen whether this will be enough to sustain the benefits of the scheme once it expires. 

“We are potentially facing a situation where the high LTV market could easily fall back into decline with the end of HTB2 now just over a year away.”

icon

Please login to comment

Zero Deposit Zero Deposit Zero Deposit
sign up