Lloyds TSB has struck a three-year deal to take on Northern Rock customers who are coming to the end of fixed rate mortgage deals. Certain mortgage customers will be offered the opportunity to switch to a Lloyds from July. The deal will assist Northern Rock in reducing the size of its balance sheet. Lloyds has set a maximum loan to value ratio of about 80% for the mortgages it will take on, but it said this will be flexible. The tax payers obviously have the rough end of the deal here - as Northern Rock which is now state owned will be left with the riskiest borrowers, just as housing repossessions are expected to rise. Northern Rock itself warned last month that arrears were rising and shifting customers could become more difficult as the economy worsens and rivals cut back on lending.
Posts Tagged ‘Loan to value’
Lloyds TSB and Northern Rock in mortgage deal
Sunday, June 15th, 2008Nationwide increases minimum deposit to 10%
Monday, April 28th, 2008
Nationwide Building Society is today reducing its maximum loan to value ratio (LTV) to 90% on all of its products for new borrowers except its three-year fixed rate and three-year tracker mortgages. New borrowers will need at least 10% deposit on all their products except the two mentioned above. New customers wanting to take out the group’s standard variable deal, which it calls its base mortgage rate, will now need a deposit of at least 25%, while the maximum amount the group will lend on any of its mortgages to new borrowers will be capped at £500,000. The two remaining products that Nationwide is offering to people with a small deposit are only available by going direct to the lender and cannot be obtained through brokers. Nationwide described the move, which takes effect from May 1, as part of its ‘ongoing approach of managing the business in a prudent and sustainable way’.
Lenders raise deposits on buying homes
Tuesday, January 15th, 2008Eleven mortgage lenders have reduced the amount of money they will lend to home-buyers by cutting their maximum loan-to-value (LTV) on at least some of their products. Some have stopped offering 100% mortgages, while others including Newcastle Building Society, will now only offer such loans when the borrower has a guarantor. Meanwhile, others including Alliance & Leicester have cut the maximum amount they will lend to 90% of a property’s value instead of the usual 95% on at least some products so far. The big lenders like Halifax, Abbey and Nationwide continue to offer 95% loans but the interest rates they charge may move higher as competition diminishes.
