Higher LTVs demonstrate 'more confidence' in the market

Date:Friday 27th February 2009
Author: Rachel Fletcher

A return by mortgage lenders to offering high loan-to-value (LTV) deals is a sign that recovery in the market is expected.

This is the claim made by Ed Mead, director of sales at London estate agents Douglas & Gordon.

Mr Mead said that "one or two" mortgage firms are going back into deals of 75 per cent of 90 per cent LTV, which he said suggested that they think prices are close to bottoming out.

He said that an institution offering 90 per cent loans "must imply to some extent, even if they are offering relatively punitive rates, that there is some confidence that we are nearing the bottom".

Research by Unbiased.co.uk recently found that nine per cent of people think they need a deposit of 40 per cent to obtain a mortgage.

Another 18 per cent believe it is necessary to have one of at least 30 per cent.