Market competition grows for high loan-to-value mortgages

Wednesday, March 25th, 2020

According to research released by Moneyfacts (a company that compiles data that is used throughout the UK Financial Industry), prior to the COVID-19 pandemic, those borrowers or potential homeowners with small deposits now have more product choice than they have had for nearly 12 months.

95% Mortgages

This is great news for homebuyers who are looking to borrow up to 95 per cent on a mortgage, and it is also a welcome boost for mortgage brokers as they will probably be inundated with enquiries from those looking to secure the very best deal available based on their circumstances, and especially where deposits are limited.

Compared to 2019, the average rate available on a two-year fixed deal had decreased by 0.19%, while rates available on a five-year fixed basis have dropped by as much as of 0.26%. *

The High Loan to Value Mortgage Market

The data illustrates that the high loan-to-value (LTV) mortgage market has picked up since the intervention last year by the Prudential Regulation Authority (the part of the Bank of England which is responsible for prudential regulation of banks, building societies, credit unions, major investment firms, and insurers); which is good news for mortgage borrowers.

Could High LTV Lending Attract First Time Buyers?

Market competition among mortgage lenders is not a new thing, but high LTV lending has not been at the top of every lenders’ agenda in recent years. However, some lenders may see this as an opportunity to attract younger borrowers and first-time buyers, who they will hope to be able to keep as customers for many years to come.

Borrowers with restricted deposits may have limited scope given the level of mortgage payments they will be able to comfortably afford, which is why many choose to use the services of a mortgage broker in order to make sure they are able to find the very best deal available to them based on their individual circumstances.

That said, many potential borrowers give up on the chance of ever getting a mortgage without even having spoken to a specialist mortgage adviser like Caboodle Finance. 

Navigating the Economic Uncertainty

Undoubtedly, the economic and political uncertainty the UK has gone through over the last few years has put some borrowers off taking out their first mortgage and may also have prevented others with an existing mortgage tying themselves into a better deal.  This has been exacerbated in recent weeks with the onset of COVID-19.

However, as many borrowers have now started to return to the market, mortgage lenders are keen to secure their share of that newly available business.

Accessing the Most Appropriate Mortgage Products

Our team always do their utmost to ensure that clients receive the very best mortgage advice and consequently get access to the most appropriate products. 

To understand more about how our friendly approach could help you, call us in complete confidence here at Caboodle Finance of Sutton Coldfield, Birmingham today on 0121 308 9114 or, alternatively, just click HERE to contact us via our website and one of our experts will be in touch.

* Source – Financial Reporter 10/02/20


Your initial consultation is free and you are under no obligation to proceed with a mortgage we recommend. There will be a fee for mortgage advice. The exact fee will depend on your circumstances and may be reduced depending on the loan amount and any commission we receive from the lender. It is estimated that the fee will be £595, but it may range from £495 to 1% of the amount you borrow. The fee is only payable on completion and can normally be added to the mortgage. This will be discussed and agreed with you before you make an application. Please ask for a personalised illustration.

Secured loan rates from 3.95% APRC, although we have plans available up to 29.9% APRC which allow us to assist customers with the most severe credit problems. The overall cost for comparison is 7.65% APRC. For secured loans a broker fee up to 10% of the loan amount borrowed may be payable on successful completion. A lender fee may also apply. The actual APRC available will depend on your circumstances. All loans are subject to status. Please ask for a personalised illustration.

The guidance and/or advice contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the UK.

Caboodle Financial Services Ltd, registered in England at Mere Green House, 46-48 Mere Green Road, Sutton Coldfield, West Midlands B75 5BT (number 08044670).
Caboodle Financial Services Ltd is an appointed representative of PRIMIS Mortgage Network (PRIMIS), a trading name of Advance Mortgage Funding Ltd which is authorised and regulated by the Financial Conduct Authority. PRIMIS is only responsible for the service and quality of advice provided to you in relation to mortgages, protection insurance and general insurance products. Any other product or service offered by Caboodle Financial Services Ltd may not be the responsibility of PRIMIS and may also not be subject to regulation by the Financial Conduct Authority. The Financial Conduct Authority does not regulate some forms of Buy to Let.

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