Mortgages 'now more affordable'

Posted: 18 Jan 2010 11:33:34 GMT

Mortgages are now more affordable than they have been in previous years because loan-to-value rates are not as high, it has been suggested.

Catherine Hearnden, director of MyMortgageDirect, says that in relation to homeowners' income, home loans are cheaper but the reason for this is because people will need higher deposits to secure a mortgage.

Her comments are backed by recent figures from the Council of Mortgage Lenders, which showed that during the month of November, people had to use less of their income to cover mortgage payments than they had for five years.

Despite this, Ms Hearnden feels that more government schemes need to be introduced to the market to allow first-time buyers (FTBs) to borrow the cash that is required for a deposit.

"The reason mortgages are more affordable is because they (FTBs) need a bigger deposit and they haven't got a bigger deposit," she adds.

Statistics from the British Bankers' Association have shown that house purchase lending increased from 42,552 in October to 44,713 in November.

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