Competition between lenders 'to make mortgages more affordable'

Posted: 30 Dec 2009 09:18:04 GMT

Increased competition between lenders in the coming year will make mortgages more affordable, one industry expert states.

Katie Tucker, technical manager at mortgageforce, predicts that as a result of this greater competition lenders will be more flexible with underwriting and credit scoring.

"They have been over-cautious this year and have refused loans to perfectly legitimate borrowers," she adds.

Furthermore, Ms Tucker goes on to say that while the market has already seen the loan-to-value rate improving, it could be that more 90 per cent home loan deals will come on the market at a reasonable rate.

Lenders' confidence could already be increasing as new figures from the British Bankers' Association show that lending for home purchases went up by 152.3 per cent in November, compared to the same month in 2008.

Similarly, the value of house purchase loans stood at £6.6 billion in the month of November, a year-on-year increase of 208.7 per cent.

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