{"id":22043,"date":"2018-11-16T09:02:12","date_gmt":"2018-11-16T09:02:12","guid":{"rendered":"https:\/\/www.buyassociation.co.uk\/?p=22043"},"modified":"2023-10-10T11:13:18","modified_gmt":"2023-10-10T10:13:18","slug":"lenders-urged-to-bring-back-the-100-percent-mortgage","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-gb\/2018\/11\/16\/lenders-urged-to-bring-back-the-100-percent-mortgage\/","title":{"rendered":"The return of the 100% mortgage?"},"content":{"rendered":"
Lenders need to bring back 100% mortgages to help first-time buyers and combat falling home ownership in the UK, according to the Building Societies Association.<\/strong><\/p>\n The BSA report includes a range of recommendations to assist first-time buyers<\/a> wanting to enter the property market. However, it is the burden placed on parents to help young people buy their first home that has provoked the call for mortgage providers to reconsider their stance on 100% mortgages.<\/p>\n Buying a home as a first-time buyer is a significant challenge for young people, so it\u2019s no wonder that 59% of younger homebuyers are reliant on parental assistance. Moreover, 87% of BSA members think that the Bank of Mum and Dad<\/a> will continue to grow in importance over the next ten years.<\/p>\n In response to the BSA report, critics have warned that due to the higher interest rates charged, borrowers are more likely to default on a 100% mortgage. Following the 2008 crash, the Bank of England imposed stricter lender criteria, but the collapse of Northern Rock, who\u2019s 125% mortgages were instrumental in its fall, is still very much in people\u2019s psyche.<\/p>\n The BSA report, aptly titled Building on the Bank of Mum and Dad, suggests that fintech<\/a> solutions, such as open banking, could make risk assessments more accurate and support full value lending at less risk.<\/p>\n The BSA thinks that building societies could offer 100% mortgages for a small percentage of first-time buyers, without compromising their overall lending book, if certain strategies and parameters are put in place:<\/p>\n The question is whether other lenders agree? The report found that most underwriters are not \u2018philosophically averse\u2019 to 100% lending, but the associated risk is well appreciated.<\/p>\n The report states, \u2018innovations in underwriting could help all potential first time buyers\u2019 and no doubt it would help take the pressure off of mum and dad too.<\/p>\n","protected":false},"excerpt":{"rendered":" Lenders need to bring back 100% mortgages to help first-time buyers and combat falling home ownership in the UK, according to the Building Societies Association. The BSA report includes a range of recommendations to assist first-time buyers wanting to enter the property market. However, it is the burden placed on parents to help young people… Read more »<\/a><\/p>\n","protected":false},"author":3380,"featured_media":19306,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[26,6],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/22043"}],"collection":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/users\/3380"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/comments?post=22043"}],"version-history":[{"count":1,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/22043\/revisions"}],"predecessor-version":[{"id":6097453,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/22043\/revisions\/6097453"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media\/19306"}],"wp:attachment":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media?parent=22043"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/categories?post=22043"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/tags?post=22043"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Over half of first-time buyers reliant on the Bank of Mum and Dad<\/h4>\n
Critics remain wary<\/h4>\n
Will lenders take the risk?<\/h4>\n
\n