FLS fails to boost higher LTV products

Two months in and against a backdrop of industry comment on the success, or not, of the Governments Funding for Lending Scheme, it is time to review the evidence.

Related topics:  Mortgages
Amy Loddington
5th October 2012
Mortgages
Whilst it is still early(ish) days the FLS, there has been little change in the number of products available to those looking for a large loan-to-value, while the already well serviced area of 20%+ deposits has continued its growth.

The leap in numbers for 75% LTV (775 products to 857 in 3 months) and 80% LTV (397 products in August to 480 in October) proves that the market has been boosted by the scheme, but lenders seem unwilling to budge, with only 7 new 95% products in the same three-month period.

Sylvia Waycot, of Moneyfacts.co.uk, comments:

“The FLS is about making lending more assessable so you could be forgiven for thinking that one of the first areas to benefit would be the FTB market which is well documented as a nightmarish struggle for those trying to get a step on the housing ladder.        

“The sad truth is that there are only seven more 95% mortgages available than before the scheme started.

“Even if you were to add together the additional 95% and 90% mortgages that FTBs crave, they would still only amount to a paltry 44 more choices.

“In contrast, those lucky enough to have a 20% deposit have an extra 83 mortgage choices, and it is similar story for those with a 25% deposit that now have 82 more choices.

“So far, the evidence suggests more mortgages, but for the same people as previously catered for, those with high deposits who pose less risk, but frustratingly, not for the poor FTB.

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