First-time buyers are looking for mortgages as the bank closes a 90% deal today but takes it off the market by 5:30 p.m.
- TSB announced it will offer a limited mortgage loan to buyers with a 10% down payment
- Buyers looking for a home worth up to £ 350,000 had to apply by 5:30 pm
- Anyone looking to buy an apartment cannot qualify for the business
- Mortgage lenders have taken out small deposit loans in the past three months
- Last week HSBC and First Direct canceled their 90% deals
- Experts warn that as lenders battle, more "flash sales" are likely to take place
First-time buyers desperate to step up the residential ladder while the stamp duty vacation stays in place are being forced to compete for mortgages in a maddening scramble.
Lenders are now so careful about lending to first-time buyers with as little as 10 percent down payment that they limit this type of lending to one-day fire sales.
TSB is the youngest bank to offer small deposit mortgages for a limited time. The 90 percent loan-to-value business can only be applied for until 5.30 p.m. today.
TSB is the newest bank to offer small deposit mortgages for a limited time only
However, potential buyers looking to buy an apartment will be disappointed as the listing is for houses only.
Mortgage experts say this type of "flash sale" is only getting more common.
Andrew Montlake of Coreco, the mortgage broker, said, & # 39; We'll definitely see more of these flash sales as lenders try to help first-time buyers but for short periods of time.
"Lenders are concerned that if they open up at these levels for longer, they will be inundated with applications and unable to deal with them."
It's a difficult time for first-time buyers as most lenders have already done riskier, low deposit deals by the time the economy got past the lockdown.
Nationwide is the last major lender to offer 90 percent LTV deals on a full-time basis, but it is already more restrictive on lending. He insists that the borrowers have good employment records, have clean loans, and can show that they can afford to pay back the loans.
The Coventry Building Society also offers mortgages to buyers with a 10 percent down payment, but only within three days.
Similarly, Accord, a broker-only lender – part of the Yorkshire Building Society – recently made these offers, but only through a 48-hour window.
Montlake added, 'The problem with this is that first-time buyers don't know when or where these new products are going to appear unless they're lucky with the lender they turn to, or they have one professional mortgage brokers do who stay on top of these notifications and are able to block the product for their customers.
"It's by no means a perfect scenario, but it's better to have a little bit of something than a lot of nothing."
TSB's five-year limited-time contract is only available today to those with a 15 or 10 percent deposit.
It cannot be used to purchase an apartment – only houses are allowed – and cannot be used for a £ 350,000 loan.
Applications are now open and will be submitted by 5 a.m. unless the bank receives the maximum number of applicants earlier.
The lender only let them know a day in advance, which means buyers didn't know it was available until the last minute.
As a result, those with small deposits are not enviable in the future, having severely limited their options and unable to plan when new deals will hit the market.
As of Friday, only 51 offers were available for those with a 10 percent deposit from 10 lenders, up from 772 before the lockdown, according to financial experts Moneyfacts.
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Lenders have largely blamed the staff shortage that has forced them to curb new mortgage loans and focus on existing customers, with most of the country still working from home and a wave of customers requesting mortgage vacations.
Lower deposit mortgages usually require more work to be drawn up as they pose a higher risk to the lender. When personnel problems at banks and building societies lead to business being cut, these businesses come first.
However, it is likely that lenders are also being more cautious about who they are lending to, to see how the economy is doing and what to do over the next 12 months, given the number of people losing their jobs and holidays Property prices happened The program is slated to end in late October.