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NewsPotential homeowners 'will have to provide larger deposits this year'
Potential homeowners 'will have to provide larger deposits this year'
Posted by Craig Williams
People looking to buy a home in the coming 12 months may have to stump up a sizeable deposit in order to convince banks and building societies to lend the necessary capital to them.
That is according to Paul Holmes, chief executive officer of online resource First Rung, who has said that mortgages will be available in 2011, but institutions are likely to request deposits of between 20 and 25 per cent before agreeing to finance purchasing deals.
Mr Holmes explained that low deposits will not represent the norm in the next year, meaning that the period whereby banks offered products such as 90 per cent loan-to-value rates may be gone.
"We have seen a brief flirtation with ten per cent deposits, I think they will go in 2011 for the most part, the normal mortgage will be a 20 per cent deposit, he noted.
Meanwhile, the Post Office stated recently that many young people see sharing a mortgage as the only way they can afford a home loan product.
28/01/2011 13:58
News category: Property