Consumers seeking home equity loans are quickly finding that it is nearly impossible to get an approval. For those with negative equity loans, this problem is acute. However, the situation with home equity loans is also affecting new home buyers. They are finding it impossible to get this type of loan unless they are able to put up a higher down payment to secure more of the equity in the house.
“Availability of mortgage deals remains the biggest issue for borrowers who do not have equity in their homes. Those who have benefited from the decade-long housing boom can still qualify for the most competitive rates.” says Francis Ghiloni, marketing and business development director at mform.co.uk.
“First-time buyers or those who have entered the property market recently will struggle to qualify for the most competitive rates. That makes it even more important for borrowers to focus on the true cost of their loan including all fees and not to simply focus on rates. There are still competitive deals and lenders willing to offer 95 per cent loans but the most competitive offers are being restricted to people with big deposits or substantial equity.”
Related reading: Home Equity Loans
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