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Moneyfacts.co.uk notes changes to UK market

Financial website Moneyfacts.co.uk has looked back on a turbulent year for UK home loans.

The main change was caused by the credit crunch, which set in last summer as a result of severe turbulence on the global money markets.

As a result, the cheap credit that had been seen in loan to value (LTV) mortgage rates at or exceeding 100 per cent is now far less easy to secure, due to increased market nervousness among lenders.

"Whereas a year ago mortgages at 95 per cent LTV were the most competitive, lenders are taking a much more cautious attitude to risk; now you are most likely to find better deals with a larger deposit, say at 75 per cent LTV," Moneyfacts.co.uk analyst Julia Harris said.

The website has also marked a decline in self-certification mortgages - which can also prove risky for home loans providers as they do not require proof of salary from borrowers.

"Unsurprisingly the choice of products for those who wish to self-certify is also dwindling," Ms Harris added.

"Like the full status 100 per cent LTV market, lenders are a lot more reluctant to lend at 90 per cent on self-certification products."

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