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Mortgage funding scheme 'creates choice'

9th October 2012 | back to article listings BACK    print this article PRINT

An 80 billion scheme to boost mortgage lending has resulted in seven more choices for potential home buyers with a 5% deposit since it launched two months ago, according to new figures.

While the market for those with deposits of 20% or more has continued to grow, consumer help website Moneyfacts said the situation has remained much the same for mortgage seekers with smaller savings.

People with a 25% deposit have more than 850 potential deals to choose from, but those with only 5% saved up - many of whom are struggling first-time buyers - have fewer than 70 choices available to them.

Buyers with a 10% deposit have 37 more mortgages to choose from than they did before the scheme launched, while those with a 25% deposit, who are often seen as less risky, have 82 more deals to select from than previously.

The funding for lending scheme was launched at the beginning of August by the Bank of England and the Treasury to provide lenders with access to cheap funding and reinvigorate the flow of credit to households and businesses.

The scheme was cited as an important contributing factor behind the increase in mortgage availability found by a Bank of England survey of lenders last week.

Copyright Press Association 2012

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