Mortgage applications for higher LTVs (Loan to Value) are predicted to rise in the first quarter of 2013, according to the Credit Conditions Survey conducted by the Bank of England.
The survey found that lenders are expecting an increase in the number of successful applications for mortgages with higher LTVs. Lenders have claimed this is in part stimulated by the rising success of the Funding for Lending Scheme (FLS) which made “significant” improvements in the lending market in the fourth quarter of 2012.
According to Bank of England this expected rise in lending may also be “driven by market share objectives” to get the market moving again, as well as a possibly renewed “appetite for risk” among lenders. This may, therefore, lead to a rise in availability on all LTV ratios.
However, while some may be more likely to take on high LTV mortgage applications, others will maintain their tight credit and financial checks when assessing an application.
Nonetheless, lenders did report they expect a rise in buy-to-let and prime loans in Q1 of 2013, despite decreases by some lenders. This could lead to an increase trend of high LTV buy-to-let mortgages.
