Conditions in mortgage market continue to toughen

First-time buyers in the UK will find the property market increasingly inaccessible, following the recent withdrawal of Abbey's 100 per cent loan-to-value (LTV) mortgages.

That is according to price comparison site MoneySupermarket, which revealed that the product was now only offered by Bristol & West, a lending arm and subsidiary of the Bank of Ireland.

Louise Cuming, head of mortgages for the site, said that the number of 90 per cent LTV products available on the market had dropped from 1,430 to 836 in just over a month.

She commented: "The term 'credit crunch' has been bandied around the media for months, but it's only starting to hit home for Joe Public now. It's enough to send a chill down anyone's spine.

Ms Cuming added that the problem was "two-fold", as there has been a decrease in both the number of mortgages available and the chances of being accepted for one.

"Twice as many mortgage applications to our broker team were declined in the past three months, compared to the first half of 2007. But if all lenders start to turn their backs on consumers, this will lead to greater economic calamity over the longer-term."

Mortgages News posted on 09/04/2008 11:20:42