PHOTO: Struggle: Lenders have pulled almost all of their remortgage deals for those borrowing at a high loan-to-value rate
Homeowners could find it almost impossible to find a new mortgage if they have only a small amount of equity in their homes when their current deal ends.
Lenders have pulled almost all of their remortgage deals for those borrowing at a high loan-to-value (LTV) rate, research for The Mail on Sunday has found.
The number of two and five-year fixed remortgage deals where you are borrowing 90 per cent of a property’s value has fallen dramatically, data from financial researcher Defaqto shows.
This time last year, there were 74 two-year fixed mortgage deals available for home owners with a 90 per cent LTV. But that fell sharply to just three in August 2020 – and those have now also been pulled.
It is a similar story for five-year fixed mortgages. There were 83 products available in the 90 per cent LTV category last year. But there were none left on the market until late last week when Metro Bank came out with a five-year fixed rate 90 per cent LTV deal.
Lenders are unwilling to lend to borrowers who they see as more risky over fears an impending house price crash could see them fall into negative equity.
It is a slightly better picture in the 85 per cent LTV market, with the number of two-year fixed rate deals falling from 68 this time last year to just 40 now.
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