Easier for First Time Buyer to Get a Mortgage

Leading banks and mortgage lenders are targeting first time buyers with a new range of mortgages designed to make it easier to get on the housing ladder in the last quarter of 2011, in a move that confirms the gradually improving landscape for prospective property owners across the country.

As house prices fall to a 21 month low, with prices dropping an average 5,000 pounds in September alone, and local councils work towards the completion of new top up schemes for mortgage applicants; HSBC are now offering a range of fee-free mortgages that offer a maximum loan-to-value rate of up to 90%, vastly improving the chances of limited equity home owners eager to take advantage of what may prove to be temporarily lower property valuations.

The initiative is to draw upon a 250 million pounds fund reserved for lending to first time buyers before the end of 2011 and will become yet another addition to the 312 new products estimated by Moneysupermarket to be made available to first time buyers this year. This is the highest number of products available since November 2008, when the credit crunch first took hold of the UK property market.

With figures such as these, it is unsurprising that July saw a massive 17% increase in first time buyer mortgage approvals across the country, although these figures are predicted to remain static for the next couple of months as the property market comes to terms with its recent stability and lenders contemplate how best to ensure this trend continues.

So long as there remains stability in lending and buyer mortgage repayments towards Christmas and the New Year said Dr. Peter Williams of the housing market specialist and chairman of Academetrics 'it is possible that the housing market will continue to remain more or less stationary over the next three months, giving an out-turn of approximately -2.5% for the year as a whole - roughly in line with a number of forecasts published by HM Treasury in August'. However, this is not to say that the road to recovery will be obstruction free.