25
Apr
100% mortgage holders 'unlikely to face equity woes'
The first-time property buyers who took out 100 per cent mortgages
before 2007 are unlikely to see any negative equity worries, it has
been claimed.
Mortgage advisor Alexander Hall said that some buyers could be at
risk, but these are the ones who chose to take on a "95 per cent
loan-to-value mortgage".
Yet these borrowers make up just ten per cent of those who took out
deals last year, spokesman Andy Pratt noted.
And changes in the market should mean that an element of protection
is added to other borrowers
He commented: "Anyone who's taken out a mortgage before that time -
even up to a hundred per cent - will actually be fairly safe
because of the increase in house prices."
The advisor based his estimations on some of the comments made by
leading analysts in the industry in recent times.
Earlier this month, Abbey announced that it has dropped its 100 per
cent mortgage in the wake of the credit crunch.