Charlie Bean, the Bank’s Deputy Governor, said “direct constraints” may be needed to restrict access to credit, and that homebuyers could be forced to put down sizeable deposits before being granted a mortgage by their banks or building societies. This would mean that prospective buyers would have to put down between 10 per cent and
25 per cent of a property’s purchase price as a deposit before being able to obtain a loan.
It is the first time that a senior official has indicated that the Bank may intervene directly with new rules on so-called “loan to value ratios” to stop risky lending. In the years before the credit crunch, some borrowers were lent 125 per cent of their property’s value and became stuck in negative equity when prices crashed. The move would also mark the return of so-called “credit controls” — scrapped in the early 1980s — which made it difficult for many borrowers to get a mortgage.
More: Bank plans to cap risky mortgages - Telegraph
---------
About ****ing time - 3x average salary is about the fair value for a house - if you want more than you are a dirty spekulant and it's just a matter of time before you get introduced to Mr Wall
25 per cent of a property’s purchase price as a deposit before being able to obtain a loan.
It is the first time that a senior official has indicated that the Bank may intervene directly with new rules on so-called “loan to value ratios” to stop risky lending. In the years before the credit crunch, some borrowers were lent 125 per cent of their property’s value and became stuck in negative equity when prices crashed. The move would also mark the return of so-called “credit controls” — scrapped in the early 1980s — which made it difficult for many borrowers to get a mortgage.
More: Bank plans to cap risky mortgages - Telegraph
---------
About ****ing time - 3x average salary is about the fair value for a house - if you want more than you are a dirty spekulant and it's just a matter of time before you get introduced to Mr Wall
Comment