100% products 'more widely available'

The number of 100 per cent mortgages available directly from UK lenders has risen by 70 per cent over the last six months, mform.co.uk has advised.

The mortgage firm has said that the statistic shows that rising interest rates, a slowdown in the UK housing market and the global credit crunch have not had an overly adverse effect on the variety of mortgage products available to borrowers.

However, mform has also cautioned that borrowers could risk their loan being worth more than their home if they take out a 100 per cent deal only to see the housing market slow further.

"The rise in the number of 100 per cent mortgage products available demonstrates that lenders believe there is a genuine demand," advised mform marketing and business development director Francis Ghiloni.

"However there are indications that the house price boom is slowing so anyone taking out a 100 per cent mortgage is risking being stuck in negative equity. And if you add hefty fees to your mortgage the risk is increased," Mr Ghiloni added.

Some lenders, such as the Newcastle building society, have nonetheless reacted to tighter lending conditions by pulling their range of 100 per cent products.


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