The government is being called upon to guarantee mortgages with a 100% Loan To Value (LTV). There are also demands to scrap stamp duty for first-time buyers.
According to some experts, bringing back the 100% LTV mortgage could help first time buyers onto the property ladder. As lenders already conduct strict affordability checks, the LTV should not be a problem if the buyer can afford the repayments. Saving for a deposit is cited as the most common reason for not being able to buy a home.
Private client assistant at Blick Rothenberg, Jonathan Barratt, states that 100% LTV mortgages would enable first time buyers to leap from rented accommodation to their own home, with only stamp duty and legal costs to be concerned about.
Some experts also believe that reintroducing the 100% mortgage would help those buyers from lower-income families, as two thirds of buyers younger than 35 turn to their parents or other family members for help to buy a property. According to Ray Boulger, from John Charcol, the reintroduction of the 100% mortgage would help to bridge the increasing social divide, as it becomes increasingly difficult to buy a property if your parents are not homeowners themselves.
However, not all believe that the 100% mortgage will be the solution, as Richard Bousfield states that the Government needs to build more homes. Davd Hollingworth believes that the key challenge is affordability, with many buyers relying on their parents to buy a home. CeMAP mortgage advisors invest in professional training so that they can offer advice to anyone who is considering a 100% mortgage.
