National Homebuyers: '125 per cent mortgages pulled'
Many homeowners may face financial difficulties after mortgage lenders pulled 125 per cent mortgages off the shelves.
[UKPRwire, Wed Feb 27 2008] The loans were introduced by lenders such as Abbey and Alliance & Leicester prior to the global credit crunch and its devastating impact on the housing market.
The deals usually include a mortgage with a loan-to-value of 95 per cent, with a further 30 per cent as a personal loan.
Many borrowers were relying on rising house prices to make the deals worthwhile, as they could sell their properties at a profit when they came to moving on.
However, recent price drops have left many people facing financial difficulties as their homes are not worth as much as the loans they took out.
As a result, lenders have begun removing the products.
"Alliance & Leicester is a prudent and responsible lender with PlusMortgage successfully targeting high quality applicants," said Stephen Leonard from Alliance & Leicester.
"However, we keep our product range under constant review and given current market conditions, we will be withdrawing our PlusMortgage products at this time," he added.
Fast property sale expert Julian King adds, "Homeowners looking for a quick property sale should consider options away from the traditional open market [estate agent] route.
"The costs, delays, uncertainties and likelihood of the property chain collapsing are all factors to consider.
"Selling your home quickly is often a more financially viable way to sell your home quickly in a falling market, such as we have today".
Mr King is a director of National Homebuyers, the UK's leading fast property purchase company, guaranteeing a quick sale for vendors who need to sell property fast.