UK Lenders Are Back with 90% LTV Mortgages

The Nationwide building society is back with 10% mortgages for first-time buyers, suggests the company's website. Previously, loans with such a high loan-to-value ratio were only available to Nationwide's Flex account holders and existing customers.

Now, however, a 90% LTV mortgage is offered for everyone at 5.39% (3-year fix) and at 5.69% (5-year fix). The arrangement fee that applies to these loans is 499 pounds.

Those looking for even a better deal can compare 90% LTV mortgage loans available from HSBC at 4.89%, Woolwich at 4.99% and Chelsea at 4.89%.

The return of 10%-deposit loans is right in time as a Mortgage Monitor from e-surv found out that 1% of all mortgages in October were taken out by borrowers with a 10% deposit or less.

Some market experts are skeptical, however. Ray Boulger, for instance, says: “The recent improvement in rates at 90% loan-to-value (LTV) won't last. The lenders are seeing pressure on margins so the small window that has recently opened up for first-time buyers… will probably only last for few more months”

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